Ahead of Facebook Inc (NASDAQ:FB)’s third quarter 2014 report on October 28, Martin Pyykkonen of Rosenblatt Securities says that growth for the company in the second half of 2014 is expected to drop compared to its performance in the same period last year.
The prediction about Facebook Inc (NASDAQ:FB) from the Rosenblatt Securities head of Internet and media stock research was highlighted in a recent report from USA TODAY.
According to the report penned by the publication’s John Shinal, Pyykkonen expects growth for the social media giant to slow to 49% for the second half of this year, a 13 percentage point drop from its growth of 62% for the second half of last year. This is based, according to Pyykkonen, on the average of estimates made by Wall Street analysts.
Nonetheless, the Rosenblatt analyst’s report on Facebook Inc (NASDAQ:FB) noted that the company expects sales to increase by 56% for the whole year.Still, Pyykkonen also said that Wall Street analysts’ consensus for Facebook Inc (NASDAQ:FB) growth next year is even more dire. He wrote in his report that analysts expect the social media giant to post a less-than-stunning 35% growth for fiscal year 2015.
According to Shinal, the company may be a victim of its own triumph in the past quarters. For four consecutive quarters up to the first quarter of this year, the company posted increased top-line growth. In the quarter ending on March this year, Facebook Inc posted revenue growth of 72%, a massive increase from the 38% increase it posted during the same period for fiscal year 2013.
New products like newsfeed ads saw the company’s revenue grow, Shinal noted, but it may also have set the bar too high for the company to make its subsequent quarters perform at par.
Facebook Inc (NASDAQ:FB) shareholders includes Karthik Sarma’s Srs Investment Management which reported 5 million shares in the company by the end of the first half of the year.