Facebook stock5/30/2023 ![]() ![]() First, note that the TTM FCF of $24.159 billion represents 2.465% of its $980.08 billion market capitalization (as of July 9). The easiest way to estimate the value of FB stock is to divide the estimated FCF by its present FCF yield. We can now use that FCF estimate to value FB stock. This is 45.89% higher than the TTM FCF of $24.159 billion as of Q1. Therefore, applying the 25.59% margin to that figure will mean that FCF will hit $35.245 billion. For example, analysts forecast that revenue in 2022 will be $137.73 billion. Now we can use this 25.59% margin number to estimate its future FCF. That means that its FCF margin over the last year was 25.59% ($24.159 billion / $94.399 billion). For example, TTM revenue from Q1 was $94.399 billion, according to Seeking Alpha. More importantly, Facebook’s FCF also represents a high portion of its revenue. This was 2.2% higher than the $23.632 billion in TTM FCF from Q4 2020. ![]() This is down from $9.22 billion in FCF during Q4, but it is still higher over the trailing 12 months (TTM).įor example, Seeking Alpha shows that the TTM FCF for Facebook was $24.159 billion (i.e., $39.988 billion in CFFO – $15.829 billion in capital expenditure). ![]() After deducting $4.272 in capex spending, the FCF figure is $7.97 billion. This is seen on page 11 of its 10-Q filing where it shows that the company produced $12.242 billion in cash flow from operations (CFFO). Estimating Facebook’s FCFĭuring Q1 Facebook produced $7.97 billion in free cash flow. We can use its FCF margins and FCF yield to value FB stock. Basically, the company is gushing cash with a significant portion of its advertising revenue flowing straight to the bottom line as free cash flow. ![]()
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