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Facebook Inc (NASDAQ:FB) continues to lose attraction from the sell side analysts, despite a majority maintaining their buy rating on the stock. The social networking giant has been on a free fall since the first day of trading at the Nasdaq stock exchange, following its botched IPO. Sterne Agee analysts, Arvind Bhatia and Brett Strauser, describe Facebook Inc (NASDAQ:FB)’s outlook as “cloudy”, due to ongoing mobile transition.

Facebook has indeed been facing a big challenge in forging traction in the new business segment, which seems to be the company’s future. Nonetheless, the analysts believe that the social media company has a great opportunity for growth in the long-term.

The analysts expect Facebook Inc (NASDAQ:FB) to report $1.192 billion in revenue, which is below the consensus estimate of $1.227 billion. Both figures predict a growth from Q2 results, which reported $1.184 billion in revenues. Sterne Agee’s Adjusted EBITDA is at about $667 million, which is higher than the consensus estimate of $651. Notably, the consensus estimate is below Q2 results of $654 million. The earnings per share is estimated at $0.11 as compared to Q2 loss.

The analysts estimate that Facebook will realize $1 billion in advertising revenue, an increase of 1% from Q2, while payments revenue is estimated at $192 million, with zero growth from the figures posted last quarter. The consensus estimates are indicative of 3.5% growth in revenue, while EBITDA estimates represent a decline of 2% from Q2.

There is a bearish sentiment among investors on Facebook Inc (NASDAQ:FB) stock, ahead of the Q3 earnings results. Additionally, Zynga Inc (NASDAQ:ZNGA)’s recent announcement, which indicated weak results, is likely to impact negatively on Facebook. The gaming company represented ~10% of the social networking giant’s revenue in Q2, which puts the same percentage of Facebook’s revenue for Q3 at the exposure of any risks associated with Zynga.

Lock-up releases by employees, insiders, and VCs are likely to flood the market, which will add pressure to the struggling stock. Notably, on November 14, a total of 1.3 billion shares owned by insiders and VCs will likely hit the market, and investors will be watching keenly to see who sells their stock. However, Zuckerberg, one of the insiders, is expected to hold his shares, at least until May 2013, as he revealed earlier.

Key Business Segments to Watch

Facebook Inc (NASDAQ:FB) recently introduced gift service, which analysts predicted that is likely to generate $1 billion worth of revenues in the early years, annually. The service will introduce Facebook to another area in a business, where, it will be competing with the likes of eBay Inc (NASDAQ:EBAY), and Amazon.com Inc. (NASDAQ:AMZN), in what looks like an eCommerce platform for its subscribers. Investors will be keen to know the plans for the new service in the company’s business model, and its potential.

The other key segment for Facebook Inc (NASDAQ:FB) is promoted posts. The service was introduced in May this year, initially for businesses, but is currently being tried on individuals. Some of the merchants have expressed their concerns over the price charged, which further puts doubt on the prospects of the segment. Individuals will be charged $7 for promoting a single post.

Targeted custom ads, also referred to as Facebook Ad exchange is what many see as company’s backbone for the future. Facebook does not need to use its own platform or its mobile app to generate revenue from this service, which gives it a huge advantage. The key is its subscriber data/information, which has also raised some serious security/privacy questions.

Mark Zuckerberg has been quoted several times, identifying mobile platform traction as a priority issue with regards to Facebook Inc (NASDAQ:FB)’s future; it would be interesting to see how plans are progressing with regard to monetization of traffic in mobile platforms, which recently reached its 600 million milestone, as compared to the overall 1 billion active users per month.

Lastly, Facebook search should be featured at some point in the results announcement, and as recently featured in our articles, Zuckerberg intends to make it special from the rest. Therefore, investors will be watching to see how things unfold.

At the time of this writing, Facebook Inc (NASDAQ:FB) stock was trading at $19.51 per share, down $0.37, or 1.85% decline from yesterday’s close. Sterne Agee analysts have lowered the social networking giant’s price target to $26 per share.