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5 things we learned from Facebook's latest blowout quarter

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Stock analysts are running out of superlatives for Facebook (FB) after its latest blockbuster earnings report.

Needham & Co.'s Laura Martin called the social media giant an "economic juggernaut." Facebook is "hitting on all cylinders," according to Michael Pachter of Wedbush Securities. Gene Munster of Loup Capital gushed that "It's hard to find fault with the quarter," while Victor Anthony of Aegis Capital spoke of how Facebook continued its "impressive streak of quarterly outperformance."  

Not surprisingly, these and other analysts recommend that investors buy Facebook's shares. According to FactSet, 39 of the 45 analysts who cover the stock rate it a "buy," while  four consider it a "hold" -- only one Facebook watcher thinks it's time sell the stock. Pacther and Anthony raised their price targets on Facebook's stock to $225 and $200, respectively, well above the $168.84 it traded at early Thursday afternoon.

Let's take a closer look at why Wall Street loves Facebook:

Big-time beat. Facebook's income surged 71 percent to $3.89 billion, or $1.32 per share, while revenue surged 45 percent to $9.32 billion. That topped Wall Street forecasts of a per share profit of $1.13 and  $9.2 billion in sales. As far as market analysts are concerned, that's a huge earnings beat. Investors are generally happy when Fortune 500 companies exceed profit forecast by a penny or two.

It's all about mobile. Demand for mobile advertising on Facebook was so strong that it offset a bigger-than-expected drop in desktop and payment revenue. Ad sales were up by 43 percent or more in every geography where it operates. Facebook also posted a better-than-expected gross margin of 86.7 percent and lower-than-expected operating expenses of $3.68 billion. That's a high-performance machine in action.  

More (more, more!) users. Facebook reported more than 2 billion monthly active users, up from 1.9 billion last quarter and 1.7 billion a year ago. Again, this closely watched metric exceeded analysts' forecasts, and is especially noteworthy given Twitter's and Snap's struggles. "We can think of no other company that reaches as many users for 50 minutes each day," Martin said in a note. 

Future's so bright. CEO Mark Zuckerberg is pushing Facebook into video, including episodic television-like shows that will one-day compete with Netflix and Alphabet's YouTube. Videos encourage users to stay on websites longer than they would otherwise, a plus for advertisers. He also is monetizing the company's popular Messenger application and its WhatsApp and Instagram services, which analysts expect will pay off big in the coming years.

Top of the heap. Simply, Facebook has no real competitors, at least not in the short-term. A day after Facebook blew Wall Street's mind, Twitter shares are down nearly 15 percent after the microblogging site reported lower-than-expected user growth. Money-losing Snap's stock is trading below its $17 IPO price, a sign that investors lack confidence in the prospects for its Snapchat app. By contrast, Facebook shares have surged 42 percent this year and is trading at an all-time high. The social media giant has also lapped the S&P 500, which has gained about 11 percent since January.

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