Which Social Media Stocks have the Strongest Earnings Trends: Facebook, Zynga, Linkedin, Groupon or Yelp?
Earnings trends are extremely important when evaluating stocks. At Wall St. Cheat Sheet, we view increasing earnings quarter-over-quarter as a simple way to gauge whether costs and the business model are stable. Then we like to analyze whether the company is outperforming peers in the sector. This is what we call the “E-Squared” investment analysis (‘E = Earnings Are Increasing Quarter-Over-Quarter’ + ‘E = Excellent Relative Performance Versus Peers and Sector’).
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Here’s your Cheat Sheet to how the top 5 social media stocks rank via earnings trends:
Facebook, Inc. (NASDAQ:FB): Current Price $28.40
|Revenue ($) in millions||272.00||777.00||1,974||3,711||5,089|
|Diluted EPS ($)||-0.06||0.10||0.28||0.46||0.01|
Revenue is growing robustly at Facebook, but EPS has taken a toss in the latest year…
Next, our CHEAT SHEET investing framework asks us to drill down to the recent quarterly data:
|Quarter||Dec. 31, 2011||Mar. 31, 2012||Jun. 30, 2012||Sep. 30, 2012||Dec. 31, 2012|
|Revenue ($) in millions||1,131||1,058||1,184||1,262||1,585|
|Diluted EPS ($)||0.14||0.09||-0.08||-0.02||0.02|
Quarterly revenue is also growing at a nice clip, but EPS was under strain in June and September 2012. Obviously, profitability has turned around in December. Facebook stays on our radar…