Facebook Inc. (FB): Earnings Beat, But No Analyst Consensus

Facebook Inc. (NASDAQ:FB) had a highly anticipated earnings report Wednesday evening, and when looking at the overall numbers, Facebook did not disappoint by beating Wall Street estimates both in revenue and earnings per share. However, like Apple Inc. (NASDAQ:AAPL) last week, although the company set records or beat expectations, the market punished Facebook the same way, as shares fell about 5 percent in pre-market trading Thursday.

That may tend to lead to some confusion on Wall Street as to what to make of Facebook Inc. (NASDAQ:FB) going forward. The company reported $1.59 billion in revenue for the fourth quarter of 2012 with an EPS of 17 cents, both of which beat estimates of $1.52 billion and 16 cents. However, the stock has seen some mixed results from analysts. Pivotal Research Group upgraded the stock from hold to buy and raised its price target from $30 to $36 per share, while Stifel Nicolaus downgraded from buy to hold and re-set its price target at $31.24 per share. Why the conflict when the numbers looked good?

Apparently it seems that what the future holds for Facebook Inc. (NASDAQ:FB) is a bit uncertain and depends on whether an analyst is a half-full or half-empty type. At Pivotal Research Group, analyst Brian Wieser said that knowing that Facebook ad revenue doubled in the quarter, “It is now clear that growth in mobile occurred primarily as the company ‘flipped the switch’ and began to effectively bundle sales of mobile and desktop advertising,” he wrote in his note. “On this basis, growth for the core products against core customers appeared solid, and very consistent with our positive expectations for the fourth quarter.”

Over a Stifel Nicolaus, however, analyst Jordan Rohan wrote that it was reacting to Facebook’s own expectation of having some margin compression in the coming year, which he wrote would lead to “a fundamental downshift in the earnings trajectory.”

What do other analysts say about Facebook Inc. (NASDAQ:FB)? More of the same?

Over at Citi, analyst Neil Doshi said in his note, “(W)ith plans to invest heavily in the biz in 2013, and little expected contribution from new initiatives like Gifts or Graph Search, we don’t see any near-term catalysts for the stock. And Mobile Ads appear to be cannibalizing Desktop, which further concerns us.” He downgraded the stock to neutral and set a $30 price target.

However, Michael Pachter of Wedbush Securities seemed to have a more bullish outlook on Facebook Inc. (NASDAQ:FB) when he wrote, “Our price target reflects Facebook’s strong monetization potential from increased mobile penetration and a series of initiatives as well as future success from new products like Graph Search and targeted ads.” Pachter set his price target on the sock at $35 per share.

A half-hour into trading Thursday, Facebook stock is down nearly 6 percent from the open to $29.40 per share.

What do you make of the Facebook Inc. (NASDAQ:FB) earnings report? And which side do you fall on – the half-empty or half-full camp? Let us know your thoughts and the numbers you analyze to make an evaluation of the company and the stock.

DISCLOSURE: I own no positions in any stock mentioned.

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