FANG Stocks: Facebook (FB)
We’ll keep the FANG stocks in order, so let’s begin with Facebook. Facebook has impressively captivated billions of users through its platform. At last check, Facebook catered to 1.23 billion daily active users, an 18% increase year-over-year. Monthly active users of 1.86 billion increased 17% year-over-year.
Even more impressively, Facebook has found a way to grow its revenue growth. That may seem like a typo, but it’s not. FB has managed to not only grow sales on a year-over-year basis, but also accelerate that rate of growth as well. After impressively growing sales in the 40% to 49% range through fiscal 2015, FB has now managed 50%+ revenue growth for five consecutive quarters. Obviously the company has found a way to continually grow and its users are not tiring of its various ad formats.
FB stock is not egregiously priced either; with a forward price-earnings ratio of just 21, Facebook shares are not that expensive with earnings per share expected to grow 28.1% this year and 23.4% next year.
Throw in the fact that Facebook has topped earnings expectations over the past 13 quarters and the stock becomes even more attractive. Shares have been on a tear this year. But a pullback to its 50-day moving average near $131 could be a buying opportunity.