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Facebook, Inc. (FB) Stock: Q3 Earnings Crush Expectations

By U.S. News & World Report

Facebook, Inc. (Nasdaq: FB) reported third-quarter earnings after the bell on Wednesday, beating both revenue and earnings per share expectations. FB stock wavered in after-hours trading after initially adding more than 2 percent on the news.

The world’s largest social media company reported revenue of $10.32 billion, up 47 percent from the same quarter last year. Analysts expected revenue of $9.84 billion.

FB earnings per share came in at $1.59, up from 90 cents a year ago. Analysts were expecting EPS of $1.28.

[Read: The 10 Most Anticipated IPOs of 2017.]

As for Facebook’s absurdly high user count — in the second quarter, it had 2 billion monthly active users (MAUs) — that continued to grow at a healthy pace as well. MAUS grew 16 percent year-over-year from 1.79 billion to 2.07 billion.

RBC Capital Markets’ Mark Mahaney, a leading Wall Street technology analyst, was expecting MAU growth of 14 percent to 2.03 billion.

When will the train stop? With FB stock already up 57 percent this year, pausing to breathe, even after stellar third-quarter earnings, isn’t the worst thing in the world. After all, Facebook shares jumped 4.2 percent last Friday simply because three other familiar Silicon Valley names — Amazon.com ( AMZN), Microsoft Corp. ( MSFT) and Alphabet ( GOOG, GOOGL) — each respectively posted blowout quarters. Seeing as Facebook essentially enjoyed its post-earnings bump before it even reported, a more muted reaction seems justified.

Before Wednesday’s results, Facebook had warned of decelerating growth in ad impressions in the second half of 2017 as the company increasingly focuses on directing user engagement toward video, which is interrupted with fewer ads than the News Feed.

“Moving forward, we do believe pricing will play more of a role in spend growth than impression and click volume growth, per Facebook’s assertions on ad load,” says Andy Taylor, associate director of research at Merkle.

[See: 7 of the Best Stocks to Buy for 2017.]

Going forward. Looking to the future, it’s inevitable that MAU growth will continue to decelerate, as one can’t expect the population of the world to grow at Facebook’s desired growth rate.

Managing the pace of that deceleration, and increasing average revenue per user (ARPU) will remain vital, and the company has done a great job on that front. In the third quarter, FB managed to grow ARPU by 26 percent, from $4.01 to $5.07. That was an acceleration from Q2’s 24 percent ARPU increase. And the MAU growth? Down just 1 percentage point from Q2’s 17 percent.

Longer-term, shareholders are in good hands with Mark Zuckerberg, who thinks with long time horizons in mind, like Amazon’s Jeff Bezos or Berkshire’s ( BRK.A, BRK.B) Warren Buffett might do. Zuckerberg thinks the biggest near- and medium-term growth catalyst will be video, and much of that growth could come at the expense of cable companies and networks.

“The internet is rivaling television for advertising spending, and there are two clear leaders in that field — Alphabet and Facebook. Both have strong user bases and multiple platforms to publish on,” says Investing.com senior market analyst Clement Thibault.

“Since the internet is here to stay and Facebook has an enormous scale advantage — it will go as far as possible,” Thibault says.

Longer-term, monetizing Facebook Messenger and WhatsApp, two messaging apps that each have more than 1 billion users, will be more meaningful. FB stock owners also have Instagram in their back pocket.

Looking even further into the future, there could be unpredictable benefits Facebook reaps by developing artificial intelligence, exploring opportunities in voice and building out its personal assistant. Zuckerberg is bullish on virtual reality longer-term, and FB could have first-mover advantage with Oculus.

[See: Artificial Intelligence Stocks: 10 Companies Betting on AI.]

There’s a lot to be excited about as a Facebook shareholder, not just with respect to third-quarter earnings, but longer-term as well.

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Facebook, Inc. (FB) Stock: Q3 Earnings Crush Expectations originally appeared on usnews.com

Don’t Settle for Student Loans to Pay for Online Education

By WTOP Staff
Online college programs are becoming a more popular choice for prospective students, with one study finding that more than 6 million students enrolled in at least one online course in fall 2015. The popularity of these courses can be attributed in part to their flexibility with working adults' schedules, students' ability to progress more quickly through online programs and, oftentimes, cheaper tuition. [See 10 low-cost online bachelor's programs for out-of-state students.]Online degrees can be beneficial to many college students, but some studies have shown online learners complete their programs at lower rates than students at traditional brick-and-mortar campuses. Individuals with student loans but no degree comprise two-thirds of defaulted borrowers. Though these numbers are not encouraging, just like for traditional programs, there are ways to reduce how much you'll need to borrow for an online program to ensure you won't become one of these statistics. Don't just settle on borrowing student loans to cover the whole cost of your program and living expenses. Instead, start thinking about how to cut costs and cover your balance in different ways, such as the following. -- Grants and scholarships: Even though you are taking an online course, you can still apply and receive grants and scholarships. But your first step should be to complete the Free Application for Federal Student Aid, commonly referred to as the FAFSA, which will allow you to receive a Pell Grant if your expected family contribution is low enough. The EFC criteria and award amounts are adjusted annually, but the 2017-2018 academic year awards range from $606 to $5,920, which could significantly lower the amount you borrow annually. Your next step is to apply for scholarships. You can start by checking online scholarship search engines, such as the Salt Scholarship Search, College Board's BigFuture and Peterson's. But don't forget to take advantage of local organizations and your school's financial aid office. Both may offer scholarships that you can't find with a national scholarship search. [Review these 10 sites to kick off your scholarship search.]For instance, organizations like the Elks Club, Knights of Columbus or the Rotary Club typically offer scholarships annually to local students. Just because you're going to school online doesn't mean you're ineligible. Visit your local library for scholarship listings, and ask around town. You might be surprised how many local organizations offer scholarships. While these scholarships typically aren't large, every little bit counts. Each dollar you receive in a scholarship is a dollar you don't have to borrow and pay interest on. -- Work-study: Another option for online students may be work-study awards. Not all students enrolled in online programs are eligible, but students at some schools -- including, for example, SUNY Empire State College and Liberty University -- are. Work-study awards are not given upfront like scholarships and grants. In most cases, they are an offer to earn up to the awarded amount if you secure an eligible work-study job. While there is a misconception that all work-study jobs must be on campus, students can work for off-campus, nonprofit or public employers as long as the work is in the public's interest. You may be able to work for a for-profit employer if the job is relevant to your course of study. No matter who the outside employer is, it will need to have an established agreement with your college for you to receive work-study funds. Remember, to be eligible for federal financial aid, you must be enrolled and pursuing a degree or certificate. If you're not working toward a credential, Pell Grants and work-study won't be option, but you may still be able to take advantage of private scholarships -- just be sure to read the eligibility criteria carefully. [Explore what to know about financial aid in online programs.]-- Pay as you go: One of the great benefits to enrolling online is the flexible schedule, which can allow you to complete your college coursework around your responsibilities. But prospective students often overlook using their part- or full-time job earnings as an option for paying for college. Almost 80 percent of college students in 2015 worked at least part time while attending classes, according to the National Center for Education Statistics. By budgeting and thinking strategically about your college costs, you can likely reduce your dependence on student loans by paying a portion out of pocket. Many -- but not all -- online programs are less expensive than traditional programs and often have shorter payment periods. Six, eight or 10 weeks are common course durations. Because of the frequency of payments in an online setting, you may be well-placed to pay as you go and possibly avoid borrowing altogether. Attending college online and avoiding student loans may be challenging, but if you are willing to put in the effort, you can limit the amount you need to borrow. More from U.S. News Q&A: Understanding Student Loan Discharge Eligibility Student Loan Refinancing Isn't Right for All Borrowers
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