FB stock rallied $3.91 or 3.76 percent in after-hours trading. GDDY shares vaulted $2.07 or 7.55 percent.
Facebook investors had been looking for earnings per FB share of $0.52, the consensus of the 45 research firms that publish estimates. Facebook was able to report $0.57, beating expectations by $0.05 or 9.6 percent.
Facebook reported gross revenues of $4.5 billion. The consensus for revenues was $4.37 billion, with Facebook management, again, handily beating expectations.
The GoDaddy earnings per GDDY share consensus going into this evening’s report was for a loss of $0.07. GoDaddy reported actual EPS of -$0.04, according to Zacks. GoDaddy’s loss was 42.9 percent smaller than expected.
FB shares traded to a new all-time high with this evening’s strong financial results. Over the past 12 months, FB stock has returned 38.1 percent compared with 1.8 percent for the Dow Jones Industrial Average (^DJI). Facebook shares have returned just over 172 percent since comping public in May of 2012. Shares of FB traded below their initial offering price of $38 for over a full year, before being able to muster the strength to move higher.
The latest report shows Facebook holding $4.3 billion in cash and equivalents and 11.5 billion in marketable securities. This gives Facebook a seeming cash position of over $15.8 billion, up from $14.6 billion at the end of the second quarter. Facebook’s total debt is $149 million, giving Facebook a debt to equity ratio of 0.4 percent, or essentially zero. Facebook last reported an operating margin of 32.4 percent and a profit margin of 18.7 percent.
Facebook revenues were up 41 percent year-over-over year and EPS was up 42.5 percent.
GoDaddy’s revenues reported this evening represented a year-over-year increase of 16.4 percent. Unlevered free cash flow grew 42.2 percent from $56.7 million in the third quarter of 2014 to $79.7 million in the third quarter of 2015.
Going into this evening’s report, analysts saw FB EPS growing by 16.9 percent this year, 32.4 percent next year, and 28.2 percent annually over the next five years. FB EPS estimates have stayed steady over the past 90 days.
Analysts saw GDDY EPS growing by 81.9 percent in 2016, and 17.5 percent annually between 2016 and 2020. Ninety days ago, analysts expected GoDaddy to be profitable in 2015 and 2016. EPS estimates for both fiscal years have turned negative over that time period. Analysts now expect a loss of $0.83 for the full 2015-year and a loss of $0.15 in 2016.
The average FB broker price target going into this evening’s announcement was $112.73; targets ranged from $68 to $146.
The average GDDY broker price target was $33.45, with targets ranging from $30 to $40.
FMR, LLC; JP Morgan Chase & Company; and The Vanguard Group, Inc. are major institutional shareholders of FB and GDDY shares. One-thousand-four-hundred-thrity-five institutions report holding FB stock. At least 10 institutions hold GDDY shares.
[Feature Photo by Justin Sullivan/Getty Images]