A bit of light shines through for the besieged social network.
Faceboook soared to a new heights on Tuesday, closing at $174.22 after almost seven months. This is despite the recent hurdles thrown across Facebook’s way, such as threats of increased regulation. Business Insider says that in February, analysts warned that these new threats could ‘spell danger’ for Facebook. In fact, Bank of America Merrill Lynch said to clients in a note, “We believe additional regulatory and negative press will likely continue to pressure valuation multiples.”
However, the 7-month-high proves that investors still haven’t lost all hope in the social media platform. Now, Facebook’s market cap is at $497 billion, up by $140 billion since Christmas last year. Investment company SunTrust Robinson Humphrey says that Facebook can handle ‘whatever is thrown in its way,’ given Zuckerberg’s smart financial moves.
“Facebook has been trying to lead the narrative around what needs to be done industry-wide to address these issues.” the company says. “It seems that the company now views regulators setting ‘rules of the road’ for the industry as crucial.”
It also adds, “We view this move as very shrewd and positive for FB over time as a) it puts the onus of resolving these issues on regulators, b) Facebook has clearly invested the most time, effort and money trying to address these issues, and as a result it is likely best positioned to comply with the rules.”
