Facebook Inc (NASDAQ:FB) has had an active day today, what with the largest share lockup being released today, though the stock price went up. Though the stock has been pretty consistently at or above $20 a share for a while – still nearly half of its IPO price – and has been showing signs of responding to its mobile challenges, at least one analyst is still bearish on the stock and went on CNBC today to tell the story.
Rich Greenfield, a research analyst at BTIG, was on “Squawk Box” this morning to talk about his firm’s Sell rating on Facebook inc (NASDAQ:FB) stock and its $16 price target. The main concern his firm has expressed has been the company’s continued work on mobile, where CEO Mark Zuckerberg had admitted that his company has been slow to adapt.
“The issue of why you want to short this stock and why we tell clients to sell Facebook at these levels … is really because of the challenge of mobile,” Greenfield said. “It’s not about the lockup, It’s not about technical events. It’s really, as the world shifts to mobile devices, the sponsored stories and ads that you see on Facebook when you’re on your mobile device, is that enough to support current valuation?”
And Greenfield also suggested that the stock has fallen since the IPO even with large growth curves, and he questioned whether those impressive growth numbers just might be running out soon, unless Facebook Inc (NASDAQ:FB) solves the mystery of mobile. “The challenge for Facebook is, people are assuming that this company can continue to grow 25, 35 percent on the top line over the next several years,” Greenfield said. “I don’t think there is value at $21, $22. At these levels, can it justify its growth rate? We’re struggling to believe that … (so) we’re advising investors to be selling at these levels rather than buying.”
Do you think investors like billionaire Steven Cohen of SAC Capital Advisorsshould consider the advice and weaken their positions until Facebook floors out? Is this stock still a concern? We’d love your comments!