Facebook Corporate Analysis (Finance Only)

FACEBOOK CORPORATE ANALYSIS

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FACEBOOK CORPORATE ANALYSIS

Background 4

Income statement analysis 6

Balance sheet Analysis 7

Liquidity Ratio 8

Current Ratio 8

Quick Ratio/Acid-Test Ratio 8

Asset management 10

Inventory Turnover 10

Fixed AsseTs Turnover 10

Profitability Ratios 11

Return on Assets % 11

Return on Equity% 11

Gross Margin % 11

Operating Profit Margin% 11

Profit Margin% 11

Financial Leverage ratios 12

Long-Term Debt Ratio % 12

Times Interest Earned/Interest Coverage % 12

Beta Coefficient 13

Bibliography 14

Appendix A 15

Income Statement 2009-2013 15

Balance Sheet 2009-2013 16

Conclusion 18

On February 4, 2004 Facebook website was launched by Mark Zuckerberg, along with a Harvard colleagues. Facebook was initially going to include Harvard students only. Yet, the website went on to grow and include other Ivy League schools as well. Facebook then advanced to include all universities and high schools. Eventually, Facebook became so large that the policy changed to cater anyone who was least thirteen years old with a valid email address. Of course, we now know that anybody or anything, animate or inanimate can have a Facebook account.

Facebook continued to grow until an eventual initial public offering (IPO) in February 2012. The stock price for NASDAQ:FB was approximately 38 dollars. Though this IPO should have been routine for NASDAQ, the Facebook IPO was greatly mismanaged. NASDAQ caused confusion on many fronts, triggering many lawsuits to follow.

Following the mishandling of the IPO, Facebook was faced with the task of monetizing its enormous social media community. It encountered hurdles of monetizing mobile platforms initially; but with time, Facebook learned to effectively leverage their ever growing user base. The social media company also quickly learned to be highly aggressive in the social media space. When Instagram, a photo sharing app with great picture filters posed a threat, Facebook wasted no time with acquiring the company. Thus expanding its foot print in the social media space via horizontal integration. Facebook has gone on to purchase other notable companies such as WhatsApp a popular messing application, and the virtual reality company Oculus Rift. Facebook shows no signs of slowing down in the near future as it plans to dabble in original content. Facebook will definitely be around for the long run and an innovator for years to come.

http://www.marketwatch.com/investing/stock/fb/financials