Contrasting Facebook (FB) & Its Peers

Facebook (NASDAQ: FB) is one of 44 public companies in the “Computer programming, data processing, & other computer related” industry, but how does it contrast to its rivals? We will compare Facebook to related businesses based on the strength of its institutional ownership, analyst recommendations, risk, profitability, earnings, valuation and dividends.

Analyst Ratings

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This is a breakdown of current recommendations and price targets for Facebook and its rivals, as provided by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Facebook 1 2 39 1 2.93
Facebook Competitors 506 1896 4607 226 2.63

Facebook presently has a consensus price target of $212.81, indicating a potential upside of 35.38%. As a group, “Computer programming, data processing, & other computer related” companies have a potential upside of 11.04%. Given Facebook’s stronger consensus rating and higher probable upside, equities analysts plainly believe Facebook is more favorable than its rivals.

Profitability

This table compares Facebook and its rivals’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Facebook 39.16% 26.49% 23.73%
Facebook Competitors -16.11% -46.83% -1.83%

Risk and Volatility

Facebook has a beta of 0.8, indicating that its stock price is 20% less volatile than the S&P 500. Comparatively, Facebook’s rivals have a beta of 1.41, indicating that their average stock price is 41% more volatile than the S&P 500.

Institutional and Insider Ownership

58.5% of Facebook shares are owned by institutional investors. Comparatively, 49.2% of shares of all “Computer programming, data processing, & other computer related” companies are owned by institutional investors. 17.2% of Facebook shares are owned by company insiders. Comparatively, 14.4% of shares of all “Computer programming, data processing, & other computer related” companies are owned by company insiders. Strong institutional ownership is an indication that endowments, large money managers and hedge funds believe a company is poised for long-term growth.

Earnings and Valuation

This table compares Facebook and its rivals top-line revenue, earnings per share and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Facebook $40.65 billion $15.93 billion 25.52
Facebook Competitors $6.96 billion $964.57 million 37.95

Facebook has higher revenue and earnings than its rivals. Facebook is trading at a lower price-to-earnings ratio than its rivals, indicating that it is currently more affordable than other companies in its industry.

Summary

Facebook beats its rivals on 10 of the 13 factors compared.

About Facebook

Facebook, Inc. is focused on building products that enable people to connect and share through mobile devices, personal computers and other surfaces. The Company’s products include Facebook, Instagram, Messenger, WhatsApp and Oculus. Facebook enables people to connect, share, discover and communicate with each other on mobile devices and personal computers. Instagram enables people to take photos or videos, customize them with filter effects, and share them with friends and followers in a photo feed or send them directly to friends. Messenger allows communicating with people and businesses alike across a range of platforms and devices. WhatsApp Messenger is a messaging application that is used by people around the world and is available on a range of mobile platforms. Its Oculus virtual reality technology and content platform offers products that allow people to enter an interactive environment to play games, consume content and connect with others.

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