Top

Facebook shares fall after downgrade on ‘toxic brew’ of slowing sales growth and regulation risk

September 4, 2018

Via: CNBC

Facebook shares will disappoint as governments increasingly scrutinize the company’s practices, according to MoffettNathanson.

The firm lowered its rating to neutral from buy for Facebook shares, predicting the internet company will generate earnings below expectations this year.

“We believe that revenue growth deceleration coupled with the company’s long-term margin guidance does not provide a meaningful near-term path for outperformance,” analyst Michael Nathanson said in a note to clients Tuesday. “Facebook is increasingly under the eye of global politicians and regulators, which will force the company to become more aggressive on spending to show contrition. … The deceleration in growth, coupled with continued regulatory scrutiny, is a toxic brew for any stock.”

Read More on CNBC