Google (GOOGL) and Facebook are no longer planning to construct an underseas cable to link the US and Hong Kong, reports Bloomberg- due to US government concerns that China might be able to collect data on Americans via the cable.
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However following the removal of the application, Google and Facebook (FB) have now submitted a new proposal that doesn’t include Hong Kong’s Pacific Light Data Communication Co, and instead links to Taiwan and the Philippines, says the report.
According to Bloomberg, Pacific Light represented a key concern for US security agencies due to its connection with China’s Dr. Peng Telecom & Media Group Co.
Shares in Alphabet have surged 22% so far year-to-date, with social media giant Facebook up 43%. And both companies score a bullish Strong Buy Street consensus, based on analyst ratings from the last three months.
However, for FB, its $292 average analyst price target implies shares could pull back from current levels over the next few months.
Rosenblatt Securities analyst Mark Zgutowicz recently reiterated a Buy rating on the stock with a $325 price target (11% upside potential) as the social media platform is “paddling out to a big holiday wave”.
“While stimulus spend fatigue may soon set in, Facebook is well-aligned to the now everything e-commerce world and looks to be walking into a can’t miss holiday compare that perhaps only Apple IDFA [Identifier for Advertisers] could disrupt,” Zgutowicz told investors.
“Further, while potentially not as large as the first consumer stimulus, we suspect #2 will be in route preholiday spending, setting up a potentially big 4Q against an enticing compare.” (See Facebook stock analysis on TipRanks).
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