A Long-Term Facebook Bull
Facebook (NASDAQ:FB) fell 1.17 percent on Friday to close at $19.52, but research firm Sterne Agee continues to be bullish on the social network’s long-term prospects. The firm’s analyst Arvind Bhatia wrote in a research note to clients on Friday that Mark Zuckerberg’s company had room for growth, keeping alive scope for its stock to grow further as well.
While Bhatia did bring his price target down to $37 from that of $47 set days before the stock debuted in May, this new predicted figure is only breathing distance away from the Facebook’s own IPO price of $38 that many others believe was inflated.
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“While the near-term outlook on Facebook remains cloudy given the ongoing transition to mobile, we continue to believe the long-term opportunity is large,” Bhatia wrote, according to AllThingsD. “Engagement remains healthy, particularly among the 18-29 year olds, and user experience remains relatively unchanged versus six months ago.”
The analysis was based on results from a user survey conducted by the firm of 750 of the network’s users. Sterne Agee found that about 63 percent of the respondents accessed the site once daily and 43 percent did it several times a day. Bhatia also found that nearly 50 percent of those surveyed were willing to use the new Gifts service launched in the U.S. by the social network, which allows users to buy presents for friends. In addition, nearly half were willing to use a Facebook search program, if one was launched.
However, Bhatia does not see promoted posts, a new advertising solution from Facebook that allows users to pay to appear on top of friends’ feeds, to pay off in a big way. According to the survey, only 16 percent expressed a liking for the function.
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