Facebook stock slides after analysts' downgrades
NEW YORK (AP) — Shares of Facebook Inc. fell Tuesday after two analysts downgraded the stock amid concerns about the company's ability to grow ad revenue quickly enough, especially on mobile devices.
THE SPARK: Bernstein Research analyst Carlos Kirjner said that while Facebook's advertising business still presents "significant untapped" opportunities, mobile ad revenue in the most recent quarter didn't grow as fast as he'd expected. He cut his rating on the world's largest online social network to "Market-Perform" from "Outperform" and lowered his target price to $27 from $33.
BTIG analyst Richard Greenfield, meanwhile, downgraded the stock to "Sell" from "Neutral." He has a target price of $22.
ANALYST COMMENT: "Facebook management continues to focus investors on the increased 'engagement' with Facebook, as consumers shift from desktop usage to mobile usage," Greenfield wrote in a note to investors.
That means people end up "touching" Facebook far more as they move to mobile use, since the Facebook app sends many of them notifications when their friends respond to their posts or for other reasons.
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