With Facebook stock down a whopping 40% from its record high, the social media giant got a price-target cut Friday by a Wall Street analyst.
Needham analyst Laura Martin cut her price target on Facebook (FB) to 170, from 215.
Her near-term concerns about Facebook include a slowdown in earnings and revenue growth, the impact of data privacy issues and “rising risks associated with growing global scrutiny, which may drive additional litigation costs and/or regulatory oversight.”
Facebook stock plunged 6.3% to close at 124.95 on the stock market today. The stock has been hammered since hitting a record high of 218.62 on July 25. Data privacy scandals play a big part in that.
Plunge Over Access, Lawsuit
Facebook stock plunged 7% Wednesday on a report that some of the world’s largest tech firms received privileged access to user information. Facebook was also was hit by news that the District of Columbia filed a lawsuit against the company over privacy concerns.
The social media stock fell to a 21-month low last month, following an article in the New York Times that raised questions about how the social media behemoth handles the spread of disinformation and other problems.
But Martin maintained a buy rating on Facebook stock, due to its dominant position in social media.
Facebook reported mixed results for the third quarter. Revenue of $23.7 billion was slightly below analyst forecasts, though earnings of $1.76 per share topped views. Reasons for the revenue deceleration include a shift toward Facebook properties with lower monetization rates. Facebook also said that core users are nearing saturation in some developed markets.
Publication: Investor’s Business Journal| Facebook Stock, Under Heavy Pressure, Gets Price-Target Cut