Twitter and Facebook are set to post earnings this week. These two technology behemoths should set the tone for internet stocks and let us know what the outlook will look like.
Facebook Earnings Report
Facebook CEO Mark Zuckerberg recently won-over students in Beijing with his fluent Chinese speaking abilities. But will he be able to win-over investors with their financial results.
Analysts expect Facebook to post earnings per share of $0.40 on revenue of around $3.1 billion. Not much to say here as the stock is currently close to an all-time high, however look for Facebook to hint at any trends in their mobile app, mobile messenger or any future mobile endeavors as that is where the company is poised to improve their earnings and solidify their dominance.
Twitter Earnings Report
Twitter is also on the docket for an earnings report this week. Along with the earnings report, we will also want to take a close look at their growth rate as a forecast of future earnings.
Twitter shares are currently down around 22% in 2014 due to a few poor earnings reports which sent their stock tumbling. However, the stock has been steadily climbing upward since then and the better than expected earnings in July helped their cause even more.
For the third quarter earnings, look for Twitter to post earnings of $.01/share on revenue of about $352 million.
Aside from earnings, we will want to take a look at the monthly active users report – last quarter, Twitter reported monthly active users of 271 million, greater than what analysts were expecting. This quarter, expectations are around 278 million to 284 million.Given that profit is tied to the active user base, an increase in active users is a good indicator of where the stock will be positioned.