Facebook (NASDAQ: FB)shares have advanced from $261 above $285 in less than five days and the current price stands around $284. Facebook has found strong support above $260 but the price is still not able to surpass $300 resistance.
Fundamental analysis: Facebook is moving to monetize WhatsApp messaging
Even with the COVID-19 pandemic, the business of Facebook is going well and the company will have a rise in revenue this year. Facebook is moving to monetize WhatsApp messaging and this will enable businesses to sell products inside the app.
India is one of Facebookâs highest user bases and digital advertising in India is expected to grow by 27% in the next 5 years. While valuation is near multi-year highs, some fund managers raised its Facebook target to $320 from $310 (implying 13% upside).
According to analysts, the Facebook price will continue to rally and will be above $300 before the US presidential election on 03 November. The company is reporting earnings a few days before the election and this will be in focus for investors.
The company increased its revenue in 2019 to $70.69B from $55.83B in 2018 and the growth projects will ensure that the numbers will be moving up in the future. At its current share price, Facebook could be a very good short-term investment with solid growth prospects.
I said short- term investment because with $811B market capitalization this stock is overvalued in my opinion and represents opportunity only for short-term traders. Profitability ratios also confirm this, P/E is above 30 which confirms that this stock is expensive.
It is also important to mention that Barclays analysts see the valuation of Facebook at bubble levels and they
