Facebook Inc (NASDAQ:FB)’s mobile traffic numbers from April have just been released this week, and analysts at Bank of America Merrill Lynch like what they see. A team of analysts at the firm examined the comScore data and said Facebook’s mobile time share is strong and growing in spite of the company’s stock performance and worries about declining user engagement.
Overall, mobile users in the U.S. were up 18 percent year over year, and time spent per mobile user was up 26 percent year over year.
Facebook’s User Engagement Rises
According to the data, Facebook Inc (NASDAQ:FB) alone saw its mobile minutes increase 129 percent year over year. That increase was offset marginally by a 17 percent decline in PC usage minutes. Across all platforms, the social network’s total U.S. minutes rose 37 percent year over year, compared to March’s increase of 34 percent.
Total Internet time share rose 14.5 percent month over month, compared to March’s increase of 14 percent. In addition, active mobile users on Instagram grew 19 percent month over month to 34 million. BAML analysts say that in spite of Wall Street’s concerns that user engagement on Facebook is waning, the data from comScore suggest that it’s actually quote strong.
Expectations For Facebook
The analysts have set a $35 per share price objective for Facebook Inc (NASDAQ:FB) and said they believe the social network will have higher three-year top-line ad growth than the average growth expected among Internet media companies. They also believe that it will see high margins on its platforms.
They see six key risks to their valuation of Facebook. First, they said a high valuation of the company could discount strong growth. Also they said that growing mobile usage could have a negative impact on revenue growth and that there could be limits on the commercial capabilities of Facebook’s platform. The other three concerns are the “potential for higher investment to negatively impact margins,” “a macroeconomic impact on advertising pricing” and “voting control by CEO” Mark Zuckerberg.
