Axiom's Anthony Highlights 5 Key Concerns Facebook Investors Might Be Considering

Victor Anthony, a senior analyst at Axiom Capital has been bullish on Facebook Inc FB since the stock was trading under $20 a share. His bullish stance remains unchanged to this day, but he does have several concerns that need to be addressed in the company's second-quarter earnings report on Wednesday.

Anthony expects Facebook to report an earnings per share of $0.83 on revenue of $6.087 billion in the quarter. By comparison, the consensus estimate is calling for Facebook to earn $0.82 per share on revenue of $6.009 billion.

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Anthony detailed his five main concerns in a research note on Tuesday.

1. Snapchat

SnapChat's growing popularity and usage growth has put "pressure" on user engagement in Facebook's core social media platform and Instagram. However, this theory hasn't been backed up with hard data nor have there been any indication that advertisers are pulling back their spend within Facebook's properties.

2. Stock Growth

Facebook's stock has grown 365 percent in absolute terms over the past three years. Anthony did acknowledge that investors shouldn't be faulted for trimming their position in the stock.

3. Consensus Estimates

Facebook needs to beat consensus estimates by a "wide margin" for the stock to "continue to work."

4. Comps

Facebook faces incrementally difficult comps in the bottom half of 2016.

5. Expenses

The prospects of higher expenses following Facebook's "ambitions" it presented during the F8 conference.

Despite Anthony's concerns, he remains bullish on Facebook's outlook given the company's secular growth profile, future monetization opportunities in Messenger and WhatsApp, the launch of Oculus products as well as new initiatives in payments and search.

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