Facebook shares surge to record despite Apple risk
Facebook shares hit a record on Monday, with the social media company taking out a peak that has stood since August as fears fade about the impact of new privacy policies from Apple.
The stock rose as much as 3% on Monday to touch an intraday record of US$307.73. Facebook has gained about 20% off a recent low and has added about 12% this year, outperforming the Nasdaq 100 Index.
Major technology and Internet stocks have broadly performed well this year. Of the so-called FAAMG names â a group that also includes Apple, Amazon.com, Microsoft and Google parent Alphabet â Amazon is the only one that hasnât hit an intraday record in 2021.
Facebookâs recent gains came after CEO Mark Zuckerberg downplayed the risk that the social media company could see as a result of an upcoming change to Appleâs privacy policies. That issue was seen as a headwind, and a reason that Facebook warned of âsignificant uncertaintyâ in 2021 earlier this year.
The company also got a positive mention in Barronâs over the weekend, which said Facebook is a âgrowth machineâ and its stock could gain 20% if it returns to the average premium itâs traded at for the past five years.
âOutsized growthâ
Analysts remain broadly positive on Facebookâs growth prospects, especially amid a recovery in the market for digital ads. Morgan Stanley recently touted Facebookâs valuation and fundamental strength, and forecast âsustained outsized growthâ.
Of the firms tracked by Bloomberg that cover Facebook, more than 85% recommend buying the stock, while fewer than 6% have a bearish rating. The average price target is $336, which implies upside of roughly 10%.
Facebook is scheduled to report first quarter results later this month. Wall Street is expecting both earnings per share and revenue to rise more than 30%. â Reported by Ryan Vlastelica, (c) 2021 Bloomberg LP