Per a Bloomberg report, Facebook Inc (NASDAQ:) is likely to be summoned by The Senate Intelligence Committee to testify regarding the Russian interference in U.S. Presidential election.
Bloomberg quoted Senate Committee Chairman Richard Burr saying that, "We’re in agreement on a Facebook public hearing. It’s just a question of when and potentially the scope.”
Reportedly, Mark Warner, another senator from the panel, put focus on a Daily Beast report that claimed that Russians used Facebook’s platform to organize protests rallies including anti-immigrant protests in August 2016. Reports add that Warner is dismayed as Facebook chose not to reveal this information to the Senate. Per him, this is the “tip of the iceberg” and extensive probe will help to uncover a lot details.
Facebook, Inc. Price
Facebook, Inc. Price | Facebook, Inc. Quote
Facebook is in the eye of the storm ever since it revealed to Congress that it identified Russian accounts (about 470) spending nearly $100,000 in ads (over 3K) coinciding with the U.S. election (from June of 2015 to May of 2017). This has caused a massive uproar.
A few days back, Facebook furnished extensive “detailed” records on Russian ad spending during U.S. Presidential elections to special counsel, Robert Mueller. This was in response to Mueller obtaining a search warrant against the tech giant. Per The Wall Street Journal, the furnished records include details of the accounts and the copies of ads and the targeted audience.
There has been widespread speculation that Russia meddled with 2016 U.S. presidential elections that resulted in Donald Trump’s victory. To investigate this, the Department of Justice (DoJ) appointed Mueller, an ex FBI chief.
Notably, Twitter is also likely to be summoned by the Senate over Russian involvement in the elections.
Since the elections, social media companies, especially Facebook and Twitter, have been under fire for dissemination of fake news that allegedly influenced elections. These companies are battling extensive PR damage. Moreover, pressure from governments of various countries including France, Germany (which goes into election few days from now) and Britain to curb spread of fake news and extremist activities on their platform is mounting.
Facebook has been tightening control over what is displayed on its platform by enabling third party verification. Facebook said it will also scrutinize ads that promote bogus stories for monetary gains. The company said that it will work with the entire news industry to improve its fact checking systems. Facebook made the “Trending” feature more automated to minimize human intervention. The company has done away with the need to write description for trending topics that required news curators to do the job. It also has deployed artificial intelligence to tackle terrorism.
Zacks Rank and Share Price Movement
Facebook carries a Zacks Rank #3 (Hold). Notably, the company has outperformed the industry in the past year. Shares of Facebook have surged 34.1% compared with the industry’s 14.4% increase.
Stocks to Consider
Better-ranked stocks in the broader technology sector include Applied Materials (NASDAQ:) , Activision Blizzard (NASDAQ:) and FormFactor Inc (NASDAQ:) , all sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Long-term earnings growth rate for Applied Materials, Activision and FormFactor is currently projected to be 17.1%, 13.6% and 16%, respectively.
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