Facebook (FB) Jumps 20% on Strong Q3 Results by TechStockProspector


Facebook suddenly has upside momentum in its mobile business

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									Robert DeFrancesco’s
October 24, 2012

Facebook (FB) Jumps 20% on Strong Q3 Numbers
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*Apple stumbles after the iPhone 5 launch
*Google shares hit a new all-time high
*Short sellers circle Splunk
*Adobe Systems embraces the cloud
*The new darling of networking security: Palo Alto Networks
*Demandware benefiting from growth in e-commerce
*NetSuite expands via its SuiteCommerce platform
*Cisco Systems gets some Wall Street support
*F5 Networks jockeys for more share of the ADC market
*Cornerstone OnDemand fends off the big HCM competitors
*Tibco Software boasts a record deal pipeline
*Oracle steps up its cloud battle against Salesforce.com
*New cloud play: Eloqua automates lead management
*Are ValueClick shares undervalued?
*A fresh valuation analysis on Yahoo
*Deal Report: Cloud security IPO Qualys

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Facebook (FB, $23.49) shares today are up more than 20% following better-than-
expected Q3 results, particularly on the mobile front.

Per-share earnings of 12 cents topped the consensus estimate by a penny and
revenue of $1.26 billion beat the consensus of $1.22 billion.

Mobile monthly active users jumped 61% year over year to 604 million,
representing nearly 60% of all monthly active users. Mobile accounted for 14% of
total ad revenue.
Exiting the third quarter, Facebook was generating roughly $4 million a day from
News Feed ads, with roughly 75% coming from mobile News Feed ads. That puts
mobile ad revenue at around $3 million a day (up from about $500,000 a day exiting
the June quarter), or $270 million a quarter. Suddenly Facebook is looking at a
mobile ad business on an annual revenue run rate of more than $1 billion.

Facebook ended the quarter with cash & investments of $10.5 billion.

My current fair-value price target for Facebook is $23.30. But I will be updating that
target based on my new 2013 revenue and earnings estimates.


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