Citi Initiates Facebook Inc (FB) Coverage With A Neutral Rating

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HFA Staff
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Citigroup Inc (NYSE:C) view Facebook Inc (NASDAQ:FB) as having great potential considering its large and global audience, valuable user data, and mobile presence. However, given the continued monetization headwinds presented by the consumption transition from desktop to mobile; challenges  of  maintaining  rapid  user/usage  growth  in  the  face  of  competition; uncertainty surrounding potentially large opportunities like video, ad network and search; expected near-term margin pressure created by the onset of an investment cycle; and valuation (6x EV/CY14 revenue), they believe the shares could continue to underperform during this transitional phase of the company’s lifecycle and are initiating coverage with a Neutral...

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