Facebook (FB) Stock Climbs: Will Gains Continue?

Facebook Inc (NASDAQ: FB)

Facebook is having an incredible day in the market today, and for good reason. The company produced solid data for the fiscal fourth quarter. Today, we’ll take a look at the Q4 earnings report, how investors reacted to the news, and what we can expect to see from FB moving forward.

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FB Reports Solid Earnings & More

Yesterday, after the closing bell, FB reported its earnings for the fiscal fourth quarter as expected. However, the report proved to be anything but what was expected. Here’s what we saw from the Q4 report:

  • Earnings Per Share – Facebook absolutely blew away expectations with regard to earnings per share. Analysts expected for FB to produce $0.68 per share in earnings for the quarter. However, the company actually reported $0.79 in earnings!
  • Revenue – In terms of top-line revenue, FB also did incredibly well. While analyst expectations were that Facebook would generate revenue in the amount of $5.37 billion, they actually reported revenue for the quarter in the amount of $5.84 billion. This proves to be a 52% year-over-year gain in top-line revenue from FB.

As you can see from the information above, the earnings report was overwhelmingly positive, no matter how you slice it. Nonetheless, that’s not all of the data that has investors excited. In fact, active users both on a monthly and on a daily scale are growing dramatically. In the fourth quarter, FB announced that it had grown its monthly active users to 1.59 billion. This came in ahead of expectations of 1.58 billion and proves to be an increase of 21% year-over-year. The company also saw a strong increase in daily active users. As of the close of the fourth quarter, Facebook’s daily active users came to a total of 1.04 billion, a 17% year-over-year growth.

How FB Stock Reacted To The News

When it comes to earnings, they have the potential to move the stock like no other piece of data, and that’s exactly what we’re seeing from Facebook today. Currently (10:06), FB is trading at $106.79 per share after a gain of $12.35 per share or 13.07% so far today.

What We Can Expect To See From FB Stock Moving Forward

Moving forward, I have an overwhelmingly bullish opinion of what we can expect to see from Facebook’s stock. The reality is that when we talk about Facebook, we’re talking about the world’s most dominant player in the social network space. However, that’s not the only reason I’m so bullish on the stock. Facebook takes a keen interest in its users – something that Twitter can’t seem to wrap its head around quit yet! Over the past year, we’ve seen several changes made to the social network, each one designed to generate a better user experience. Not to mention, FB isn’t just a social network – it has become a way of life. With more than one-seventh of the world’s population using the social network, it is spreading like a virus and will likely continue doing so. Ultimately, Facebook is here to stay, and, as long as it’s here, revenue will likely continue growing, maintaining investor excitement and leading to gains in the market.

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What Do You Think?

Where do you think FB is headed and why? Let us know your opinion in the comments below!

[Image Courtesy of Flickr]

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