Will Facebook (FB) Stock Be Helped by Rift Launch?

NEW YORK (TheStreet) -- Facebook  (FB) remains on schedule to ship Oculus Rift in the first quarter, but the company delayed the launch of Oculus Touch

Oculus is a virtual reality company that Facebook acquired last year for $2 billion

Oculus announced on Thursday that it remains on-schedule to launch pre-orders for its virtual reality system known as Rift. The product is expected to cost at least $350, USA Today reports.

Additionally, Facebook delayed the release of Touch, which is a motion controller, until the second half of 2016. The product was originally supposed to launch at the same time as Rift, Tech Crunch reports.

"On Touch hardware, we've made significant advances in ergonomics, and we're implementing many changes that make Touch even more comfortable, reliable, and natural. We're also implementing changes that improve hand pose recognition," Oculus said in a statement on Thursday. "We're also outputting larger numbers of pre-production runs, which means we can get a lot more Touch hardware in the hands of developers who need it."

Facebook stock is down by 1.33% to $104.81 in late afternoon trading on Thursday.

Separately, recently, TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author. TheStreet Ratings has this to say about the recommendation:

We rate FACEBOOK INC as a Buy with a ratings score of B+. This is driven by a number of strengths, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, good cash flow from operations, growth in earnings per share and expanding profit margins. We feel its strengths outweigh the fact that the company has had somewhat disappointing return on equity.

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The revenue growth came in higher than the industry average of 15.1%. Since the same quarter one year prior, revenues rose by 40.5%. This growth in revenue appears to have trickled down to the company's bottom line, improving the earnings per share.
  • FB's debt-to-equity ratio is very low at 0.00 and is currently below that of the industry average, implying that there has been very successful management of debt levels. Along with this, the company maintains a quick ratio of 9.96, which clearly demonstrates the ability to cover short-term cash needs.
  • Net operating cash flow has significantly increased by 75.64% to $2,192.00 million when compared to the same quarter last year. In addition, FACEBOOK INC has also vastly surpassed the industry average cash flow growth rate of 3.05%.
  • FACEBOOK INC's earnings per share improvement from the most recent quarter was slightly positive. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, FACEBOOK INC increased its bottom line by earning $1.10 versus $0.59 in the prior year. This year, the market expects an improvement in earnings ($2.17 versus $1.10).
  • The gross profit margin for FACEBOOK INC is currently very high, coming in at 94.80%. It has increased from the same quarter the previous year. Regardless of the strong results of the gross profit margin, the net profit margin of 19.90% trails the industry average.
  • You can view the full analysis from the report here: FB

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