1

PRESENTATION
FINANCIAL STATEMENT ANALYSIS FOR
INVESTORS

HIMANSU BADHAI
PRATIK GUPTA
SAI KRISHNA KODALI
The Basics Facebook
• Largest Online Social Network: 1.3 Billion Users
• Potential Conglomerate
• Founded: Mark Zuckerberg...
Investment in Facebook Inc. Final Verdict

3
Final Verdict Comments
• Free Cash Flow:
• Equity from Public Trading
• Long Term Profits

• Debt:
• Equity Multiplied Liq...
Financial Statements Income Statement

5

Facebook Inc.
CONDENSED MULTISTEP INCOME STATEMENT
FISCAL YEAR ENDED DEC-31
($ i...
Financial Statements Balance Sheet

6

Facebook Inc.
CONDENSED CLASSIFIED BALANCE SHEET
31-Dec
Year-

($ in millions)
End
...
Financial Statements Cash Flows

7

Facebook Inc.
CONDENSED STATEMENT OF CASH FLOWS
FISCAL YEAR ENDED DEC-31

($ in millio...
The Mobile Momentum

8

source

Facebook’s actual mobile revenues were $720m in FY13 Q2
and $900m in FY13 Q3.
The Mobile Momentum How did Facebook do it?

Newsfeed ads helped drive mobile advertising

9
The Mobile Momentum The Bigger Picture

source

10
TREND & COMMON SIZE ANALYSIS Income Statement
Key Takeaways from Common Size Income Statement
70.00
60.00
50.00

2012

40....
TREND & COMMON SIZE ANALYSIS
Statement of Cash Flows

12

Key Takeaways from Common Sized Cash Flow Statement
500.00
389.7...
RATIO ANALYSIS Industry Average Calculation
Title of Ratio
Profitability Ratios
Return on sales (ROS)
Return on assets (RO...
RATIO ANALYSIS

14
Year wise ratio comparison

4

3

2

1

0
Return on
sales (ROS)

Return on
assets (ROA)

Return on
equi...
STOCK ANALYSIS

15
16

THANK YOU

QUESTIONS
Upcoming SlideShare
Loading in …5
×

Facebook

1,060 views

Published on

Published in: Business, Economy & Finance
0 Comments
1 Like
Statistics
Notes
  • Be the first to comment

No Downloads
Views
Total views
1,060
On SlideShare
0
From Embeds
0
Number of Embeds
2
Actions
Shares
0
Downloads
27
Comments
0
Likes
1
Embeds 0
No embeds

No notes for slide
  • Facebook’s actual mobile revenues were $720m in FY13 Q2 and $900m in FY13 Q3.
  • Facebook’s actual mobile revenues were $720m in FY13 Q2 and $900m in FY13 Q3.
  • Facebook’s actual mobile revenues were $720m in FY13 Q2 and $900m in FY13 Q3.
  • Facebook

    1. 1. 1 PRESENTATION FINANCIAL STATEMENT ANALYSIS FOR INVESTORS HIMANSU BADHAI PRATIK GUPTA SAI KRISHNA KODALI
    2. 2. The Basics Facebook • Largest Online Social Network: 1.3 Billion Users • Potential Conglomerate • Founded: Mark Zuckerberg , 2004 • IPO: May 17, 2012 • First in Domain • Current Value: $104 Billion • Largest Acquisition: Instagram, August 2012 2
    3. 3. Investment in Facebook Inc. Final Verdict 3
    4. 4. Final Verdict Comments • Free Cash Flow: • Equity from Public Trading • Long Term Profits • Debt: • Equity Multiplied Liquid Assets • Reduced Debt Ratio • Revenue and Gross Profit: • 30% mark up on Gross Profit • Focus on Growth: • Investment in R&D and Expansion • Potential: • Monthly Active Users Steadily Increasing • New Revenue Streams 4
    5. 5. Financial Statements Income Statement 5 Facebook Inc. CONDENSED MULTISTEP INCOME STATEMENT FISCAL YEAR ENDED DEC-31 ($ in millions) YearEnd 2,012 2,011 Sales Revenue $ 5,089.00 $ 3,711.00 Cost of goods sold $ 1,364.00 $ 860.00 Gross Profit $ 3,725.00 $ 2,851.00 Operating Expenses $ 3,187.00 $ 1,095.00 Operating Income $ 538.00 $ 1,756.00 $ $ $ $ $ Non operating revenues and expenses Income before income tax Minority Interest provision for income tax Income from continuing operations Nonrecurring items NET INCOME Earnings per share $ (24.00) $ 1,008.00 $ 234.00 $ 402.00 $ 372.00 $ $ 372.00 $0.00 $ $ $ $ $ $ $ $ (44.00) 494.00 21.00 441.00 32.00 32.00 0.01 $ $ $ $ $ $ $ (61.00) 1,695.00 332.00 695.00 668.00 668.00 $0.00 2,010 1,974.00 493.00 1,481.00 449.00 1,032.00
    6. 6. Financial Statements Balance Sheet 6 Facebook Inc. CONDENSED CLASSIFIED BALANCE SHEET 31-Dec Year- ($ in millions) End 2,012 2,011 2,010 Current Assets $ 11,267.00 $ 4,604.00 $ 2,246.00 PPE, net $ 2,391.00 $ 1,475.00 $ 574.00 Goodwill and Intangibles $ 1,388.00 $ $ 96.00 Other Assets $ 90.00 $ 74.00 TOTAL ASSETS 57.00 $ 162.00 $ 15,103.00 $ 6,331.00 $ 2,990.00 Current Liabilities $ 1,052.00 $ 899.00 $ 389.00 Noncurrent Liabilities $ 2,296.00 $ 533.00 $ 439.00 Contributed Capital $ 10,094.00 $ 3,299.00 $ 1,562.00 Retained Earnings $ 1,659.00 $ 1,606.00 $ 606.00 Treasury stock and other SE $ (6.00) $ (6.00) TOTAL L & SE 2.00 $ $ 15,103.00 $ 6,331.00 $ 2,990.00
    7. 7. Financial Statements Cash Flows 7 Facebook Inc. CONDENSED STATEMENT OF CASH FLOWS FISCAL YEAR ENDED DEC-31 ($ in millions) End Year2,012 2,011 Net cash from operating activities $ 1,612.00 Net cash from investing activities $ (7,024.00) $ (3,023.00) $ (324.00) Net cash from financing activities $ 6,283.00 $ 1,198.00 $ 781.00 Effect of exchange rate on cash $ $ 3.00 $ (3.00) Net changes in cash $ Cash, beginning $ 1,512.00 $ 1,785.00 $ Cash, ending $ 2,384.00 $ 1,512.00 $ 1,785.00 1.00 $ 1,549.00 2,010 872.00 $ $ 698.00 (273.00) $ 1,152.00 633.00
    8. 8. The Mobile Momentum 8 source Facebook’s actual mobile revenues were $720m in FY13 Q2 and $900m in FY13 Q3.
    9. 9. The Mobile Momentum How did Facebook do it? Newsfeed ads helped drive mobile advertising 9
    10. 10. The Mobile Momentum The Bigger Picture source 10
    11. 11. TREND & COMMON SIZE ANALYSIS Income Statement Key Takeaways from Common Size Income Statement 70.00 60.00 50.00 2012 40.00 2011 30.00 2010 20.00 2012 w/o R&D 10.00 0.00 Operating Expenses Income before income tax NET INCOME 11
    12. 12. TREND & COMMON SIZE ANALYSIS Statement of Cash Flows 12 Key Takeaways from Common Sized Cash Flow Statement 500.00 389.76 400.00 300.00 200.00 54.09 100.00 2012 0.00 2011 -100.00 2010 -200.00 -300.00 -400.00 -500.00 -435.73 Net cash from investing activities Net cash from financing activities Net changes in cash
    13. 13. RATIO ANALYSIS Industry Average Calculation Title of Ratio Profitability Ratios Return on sales (ROS) Return on assets (ROA) Return on equity (ROE) Gross profit margin Efficiency Ratios Account receivable turnover Inventory turnover Asset turnover Liquidity Ratios Current ratio Solvency Ratios Debt ratio Financial leverage Times interest earned Free cash flow ($ in millions) Twitter Pandora -0.25052 -0.09548 -0.12717 0.593706 -0.08931 -0.17433 -0.38538 0.319278 2.825848 4.130597 0.381127 1.951931 5.046151 1.712633 0.249173 1.331864 -31.0068 114.55 0.547648 2.21067 -70.471 22.6 Average -0.16992 -0.1349 -0.25627 0.456492 0 3.478222 0 1.166529 0 3.379392 0 0.398411 1.771267 -50.7389 68.575 13
    14. 14. RATIO ANALYSIS 14 Year wise ratio comparison 4 3 2 1 0 Return on sales (ROS) Return on assets (ROA) Return on equity (ROE) Gross profit margin Account receivable turnover Asset turnover Current ratio Debt ratio -1 -2 -3 2011 2012 2012 w/o R&D expense Industry Averages Financial leverage Times interest Free cash flow earned ($ in millions)
    15. 15. STOCK ANALYSIS 15
    16. 16. 16 THANK YOU QUESTIONS

    ×