Facebook Stock Touches All-Time High in January 2020



What to expect in this article about Facebook:

  • Facebook (NASDAQ: FB) stock price highlights in the last week.
  • Deutsche Bank’s FB stock recommendations.
  • Also, the French Digital Services Tax.
  • Deepfakes on Facebook.
  • Facebook plans to expand ad campaigns in China.
  • Also, FB takes action against fake e-commerce reviews.
  • Facebook political Ad Policies update.
  • Lastly, Cowen Ad Buyers Survey highlights and Bernstein recommendations.
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Facebook stock price highlights

Facebook stock performed well throughout the second week of January 2020. And, the stock gradually moved to a new 52-week high. Starting from $206.70 on Monday, FB stock grew 5.5% by Friday to end the week at a market cap of over $621 billion. In comparison, the stock price gained 0.3% last week. Maybe one of the reasons is the positive brand image created at the beginning of the week after a fundraising attempt on the social media platform.

On Monday, News Corp Australia reported celebrity Celeste Barber’s efforts to support the Australian bushfire fight. Eventually, Celeste collected $40 million through her fundraising campaign on Facebook. Currently, Facebook is dealing with regulatory scrutiny in the US and Europe. So, the fundraiser showed Facebook’s positive influence in Australia at a time of crisis.

With that opening note, here are some highlights for FB investors. Also, it includes a summary of why FB stock price gained last week.

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Deutsche Bank recommends Facebook stock

A CNBC report on January 4 quoted Deutsche Bank’s “Buy” rating for Facebook. Also, the German bank’s analysts believe Facebook’s app could add value to both FB stock and its investors.

The rating hinted at the changes in FB’s recent product offerings. The bank said that Facebook will focus on “promoting meaningful content, rolling out Stories, scaling Marketplace, building its Groups product, adding more video content and continuing to improve relevancy algorithms across content and ads.”

Updates on the French Digital Services Tax

For all the FAANG stocks, Monday marked the exchange of words between lawmakers in France and the US in connection to the French Digital Services Tax. Reuters reported a statement from Bruno Le Maire, the Economic Minister of France. In the statement, Le Maire suggested France reach out to WTO (World Trade Organization) to intervene.

Earlier in July 2019, France announced a digital tax that could affect US companies like Facebook and Google. Additionally, the French tax could come into effect sometime in the next month. Also, US President Trump plans to respond with 100% tax levy on a number of French imports, estimated at $2.4 billion.

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Reuters published a follow-up report on Tuesday that claimed senior leaders from the US and French governments will chalk out a plan to end the tax row. Steve Mnuchin, the Treasury Secretary of the US, and Le Maire hope to discuss and arrive at mutual grounds before the World Economic Forum. So, the forum is scheduled between January 21 and January 24.

Facebook ups efforts to remove deepfakes

In August, FB tweaked its guidelines in an attempt to steer clear from trouble. Still, there were incidents when CEO Mark Zuckerberg fended off questions about the social media platform’s ads policies. Questions such as, is there a secret deal between Zuckerberg and Trump? Or, is the FBI indirectly boosting FB’s ad revenues? A CNBC report compiled a list of Zuckerberg’s regulatory woes along with the timeline of events.

After the Cambridge Analytica episode, Zuckerberg seems to be wary of the upcoming 2020 presidential elections. Now, the company plans to address the problems of deepfake videos on Facebook. Deepfake videos use AI technology to make an edited video seem genuine.

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Monika Bickert, vice president of Global Policy Management, released a post detailing a new set of policies to deal with this issue. Also, Bickert’s announcement discussed the efforts like partnering with academic and government institutions, reviews by “independent third-party fact-checkers,” et cetera.

In my opinion, it definitely seems like an attempt to clean up deepfakes before the 2020 elections. It is a huge task for Facebook. However, it does seem to have a positive effect on its stock price. FB stock closed 3% higher than its opening price on Monday.

Facebook’s plans for China ad business

On Tuesday, there were reports about Facebook’s plans to expand in Singapore. According to Reuters, a team in Singapore will focus to improve the ad business in China. The report suggested that the social media platform provides $5 billion worth of ad spaces featuring Chinese messages to the global audience.

One such instance is the sensational app, TikToK, which currently has a massive fan following worldwide. Tiktok is a subsidiary of Bytedance, an internet-related services company based out of Beijing.

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FB Europe takes actions against fake reviews

Facebook decided to take action against fake e-commerce reviews posted on its portal in the European region. An article featured on Nasdaq quoted that over 188 groups were ousted along with deactivation of 24 accounts.

The article said Facebook is considering the use of “automated technology” to locate and remove such reviews after the CMA (Competition Markets Authority) flagged this issue. Plus, even eBay removed fake reviews from its e-commerce portal and banned 140 accounts.

Forbes reported that CMA chief executive Andrea Coscelli suggested that allowing fake reviews wasn’t intentional and welcomed the efforts by the companies to remove them. Coscelli said, “We’re pleased that Facebook and eBay are doing the right thing by committing to tackle this problem and helping to keep their sites free from posts selling fake reviews.”

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Facebook ad policies

The news about how Facebook handles its ad campaigns came to the fore again on Thursday. The US lawmakers were opposed to an edited video of House Speaker Nancy Pelosi followed by demands that the video is removed. FB denied the request, claiming it does not violate the deepfake policy.

However, the company decided to take a different approach. So, Facebook updated its Ad Library and releasing new guidelines. The company hopes to increase transparency by giving users control over political ads.

Cowen Survey and Bernstein recommendations

Investment bank Cowen released findings from its ad buyers survey, which put Facebook on the second spot behind Google. The survey is an annual report that estimates the ad-buying trends of 50 US advertisers.

According to Economy news, the Cowen survey estimates Facebook ad revenues close to $84 billion for the year. Also, a Reuters report claimed that, based on the survey, Cowen analysts raised the price target for Facebook, Alphabet, and Twitter.

On Friday, Facebook touched an all-time high of $219.88. Plus, there were reports on CNBC that even Bernstein raised Facebook stock as outperform.


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