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Analysis of Facebook Inc. (#FB)

Analysis of Facebook Inc. (#FB)

7 April 2021

Facebook Facebook Inc. is the company that owns the largest social network in the world – Facebook. Facebook is one of the five most visited websites in the world. The monthly audience of the network is more than two billion people. The daily active audience is more than a billion people — this is how many are recorded by the Facebook tracking network every day. Facebook Inc. He is the owner of other popular services, such as Instagram, WhatsApp, workplace (corporate messenger) and Oculus VR. The main source of the company’s revenue is advertising.

The company’s main competitors are tech giants Amazon, Alphabet, Apple and Microsoft. 

Revenue for 2020: $86.0 B (+21% compared to the previous year)

Operating income for 2020: $32.7 B (+36% y-o-y)

Net income for 2020: $29.1 B (+57% y-o-y)

Earnings per share for the latest quarter: $3.88, up from $3.22 forecast

The crisis had little impact on the company’s operations. Advertising revenue suffered the most.

Geographical distribution of revenue:

United States and Canada – 44.71%

Europe – 23.67%

Asia-Pacific – 23.09%

Rest of the World – 8.53%

Investors like the company because it grows faster than the market, although it does not pay dividends. Despite the fact that #FB is a technology company, the marginality for operating and net profit is at a fairly high level. In addition, the company already has a fully functioning business model. And the excess cash in the accounts is actively invested in non-organic growth and spent on share repurchases.

Thus, Facebook Inc is a sustainable technology company that has been showing excellent financial and operational results for many years. And even though the company’s securities are slightly overbought at the moment, investing in #FB will be a great investment for the long term.

7 April 2021
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