Social networking giant Facebook's (NASDAQ:
) 40-day silent period ended Wednesday, and predictably the
analyst research reports flooded in.
Following that period, which the brokers and investment banks
are held to after an IPO, Facebook may feel that, after a rocky
start, it came through fairly unscathed.
Credit Suisse, Citi and Bank of America Merrill Lynch all
initiated coverage at Neutral, with Bank of America stating that,
while it is early in its opportunity to capitalize on its
expansive social graph that includes over 900 million monthly
users, "We are positive on long-term fundamentals given that 14%
of all US online time spent and 8% of traffic to top Internet
sites came from Facebook (Comscore), highlighting the sites'
strong potential value to advertisers. However, the company is in
the midst of a mobile usage transition and we are cautious on
Facebook's revenue trends until new mobile ad revenue models
start driving the top line."
Piper Jaffray, J.P. Morgan and Morgan Stanley all initiated
coverage at Overweight, with J.P. Morgan analyst Doug Anmuth in
particular singing Facebook's praises. "As the underlying social
fabric of the Web, Facebook is a unique platform asset with
strong network effects, a deep competitive moat, and unparalleled
social context," said Anmuth. "We believe the next phase of the
Internet will be driven by data and powered by ubiquitous online
access, and Facebook is well positioned here through its large
and engaged user base, virtual ownership of the social graph, and
unwavering focus on the user experience."
Piper Jaffray put Facebook on a pedestal with Apple (NASDAQ:
), Google (NASDAQ:
), Amazon (NASDAQ:
) and Microsoft (NASDAQ:
) as one of the five most important companies on the web, stating
that the 1-3 year picture is bright.
Morgan Stanley, possibly a little sheepish following its role
in the botched IPO, titled its report "The Start of the Social
Era", with analyst Scott Devitt going on to say that, "We believe
that Facebook is uniquely positioned to leverage its large and
highly-engaged user base to monetize the mobile Internet."
Oppenheimer told a similar story, initiating at Outperform and
saying, "With the fragmentation of media and communication, we
believe consumers will increasingly find media and information
through their social graph, positioning FB in the middle of this
Goldman Sachs initiated at Buy, while claiming that social
platforms like Facebook are helping to usher in the next era of
the web. "In our view, given its user base and leading social
platform, Facebook is poised to dominate this next phase of the
internet and as such will maintain industry high growth rates
throughout next decade. We believe concerns over "Facebook
fatigue" are overstated while the potential for material upside
to CPMs is underappreciated."
On Wednesday, Facebook traded at around $32, down over 3%.
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