FTC Accusations Put Facebook Stock Under Pressure

The sentiment surrounding FB is still overwhelmingly bullish, however

Deputy Editor
Dec 10, 2020 at 9:31 AM
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Facebook, Inc. (NASDAQ:FB) remains under pressure today, following yesterday's news that the Federal Trade Commission (FTC) and 48 states have filed lawsuits against the social media giant, accusing it of anti-competitive practices. These lawsuits could force FB to sell its highly lucrative acquisitions, Instagram and WhatsApp. Meanwhile, the company is pushing back, calling the lawsuits "revisionist history." 

As a result, FB is slipping even lower in electronic trading, off 0.9% at $275.54 at last check, and down more than 1.8% for the week. The 100-day moving average is still holding out as support, however, though the equity closed back below its 10-day moving average, which provided a temporary floor for FB last week. 

The stock still sports a roughly 38% year-over-year lead, and analysts aren't deterred just yet. In fact, 30 of those covering the equity call it a "buy" or better, compared to  just two "hold" ratings. Plus, the 12-month consensus price target of $319.30 is a 14.9% premium to last night's close. 

Options players are also overwhelmingly bullish. At the International Securities Exchange (ISE), Cboe Options Exchange (CBOE), and NASDAQ OMX PHLX (PHLX), FB sports a 10-day call/put volume ratio of 3.48, which stands higher than all but 6% of readings from the past year.

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