Facebook Investment: Facebook Downgrade Information

Facebook Investment: With Facebook Inc (NASDAQ:FB) planning to go into “investment mode” in 2013, many on Wall Street are beginning to worry.

Yesterday, MarketWatch reported “shares slipped Thursday after the company reported strong results, but unwrapped a plan to go into investment mode in the coming year.”

Despite the fact that the company appears to be moving in the right direction, revenue gains are being downplayed as the social media giant expects expenses to outpace sales.

In the same article by MarketWatch, Citigroup analyst Neil Doshi had the following to say in a note in which the stock was downgraded from buy to neutral.

“We view Facebook as a core long-term ‘Net stock’. But with plans to invest heavily in the biz in 2013, and little expected contribution from new initiatives like Gifts or Graph Search, we don’t see any near-term catalysts for the stock. And Mobile Ads appear to be cannibalizing Desktop, which further concerns us.”

This is not to say that Facebook Inc (NASDAQ:FB) is losing momentum. For example, the company is showing strong gains in mobile. In fact, with 23 percent of ad revenue mobile related, it shows a jump of 9 percent from the previous quarter.

Also, the company has talked about the rise in the number of mobile users. In the fourth quarter of 2012, there were more daily mobile users than desktop users.

Stifel Nicolaus analyst Jordan Rohan added the following information:

“We potentially would look to add to positions in the mid-$20s, or when the duration of this investment phase is better understood, all else being equal.

This is in addition to BMO Capital’s Daniel Salmon:

“We thought the quarter was perfectly fine. However, we don’t yet have the thesis to raise our target into the mid- to high-$30s.”

While there is a lot of negative talk swirling around, other analysts are looking on the bright side of Facebook Inc (NASDAQ:FB):

Ben Schachter of Macquarie Equities kept an outperform rating, saying the following:

“While the magnitude of the investment is surprising, long-term believers will view the margin reset as an opportunity given that fundamental story remain intact.”

As you can see, there are analysts on both sides of the fence.

How do you feel about where Facebook Inc (NASDAQ:FB) stands right now? What is your feeling on what 2013 will bring?

Check back here for more updates on Facebook Investment.

DISCLOSURE: I have no positions in any stock mentioned.

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