Sunday, December 8, 2019

Where Will Facebook Be in 10 Years?

Here is the article.

It's still the cheapest FANG stock

Wall Street expects Facebook to grow its earnings at an average rate of 22% over the next five years. Based on that forecast, we get a PEG ratio of 1.0. A PEG ratio below 1 indicates that a stock is undervalued, but that's rare for high-growth tech stocks. The three other "FANG" stocks have 5-year PEG ratios closer to 2. This means that if you believe that Facebook can generate at least 20% revenue and EPS growth over the next five years, it's actually the cheapest FANG stock.
Analysts don't offer 10-year estimates, but Facebook's growth momentum should continue as it follows its 10-year growth plan. Reports of Facebook's "death" have been greatly exaggerated, and it could climb much higher over the next ten years.


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