This article looks into whether investing in Facebook stocks is a good idea. It focuses on the current trends in the stock market, including companies such as Apple, Microsoft, and Amazon, and their influence on Facebook's success. It also looks at the risks associated with investing in Facebook and provides some tips on how to minimize them. Finally, the article identifies the unique advantages of owning Facebook stock, such as its ability to maximize long-term gains and its potential for future growth.
If you are thinking about whether to buy Facebook shares, then look at this investment idea from the analysts of the Finam brokerage company. They evaluated the social network, conducted an analysis and established a positive recommendation..
Recommendation Summary
Short description of the issuer
Facebook is the developer and operator of the social network of the same name, which allows people to communicate using smartphones and computers. This is the most popular social network in the world. 2.32 billion people use it every month (as of December 31, 2018).
Facebook Market Capitalization – $ 521.4 Billion.
The company also owns world-famous Instagram and WhatsApp services..
Since the beginning of 2019, Facebook shares have yielded 34.6%. They went up significantly ahead of the US market, which grew by only 16.6% (index S&P 500).
The company from year to year shows a positive trend in revenue and net profit on paper. At the same time, Facebook shares remain relatively underestimated from a fundamental point of view..
Analysts evaluate the latest quarterly reporting by Facebook positively and consider the company’s shares attractive for investments for the current year..
Finam analysts recommend buying Facebook shares with a target price of $ 205.
Facebook highlights
Summary of Key Figures
Comparison of Facebook stock returns and S index&P 500
Data Source – Thomson Reuters
Growth factors
Almost a third of the world’s population uses Facebook every month. The number of daily active users reaches 1.56 billion.
85% of smartphone owners have installed the Facebook app. Users on average go there 8 times a day, on Instagram – 6 times a day. By comparison, Twitter users do this 5 times a day..
If you do not consider the Google Play and YouTube applications preinstalled on Android devices, then by the end of 2018, the social network Facebook became the leader in the number of downloads in the Google Play store. The app has been downloaded over 4.1 billion times during the year, according to Android Rank..
In second place by the number of downloads is Facebook Messenger. Android users need it more than 3.4 billion times in 2018.
The third line in this ranking is another company product – WhatsApp. It was downloaded nearly 3 billion times last year.
The fourth place in the ranking for 2018 is also occupied by the Facebook product – Instagram. 1.84 billion times downloaded in a year.
On iOS devices in 2018, iPhone users came in second place with the Instagram app, Facebook Messenger in the fourth, Facebook in the fifth, and Twitter only in 20..
The dominant position of Facebook on both of the most popular platforms remains. Therefore, in the coming quarters we can expect a positive trend in terms of active users and advertising revenue..
Financial results
Following the results of the past quarter, Facebook recorded a continuation of the positive dynamics of the main indicators.
The company’s revenue increased by 26% YoY and amounted to $ 15.08 billion. It exceeded average forecasts at $ 14.96 billion..
Net income reached $ 2.43 billion, or 85 cents per share, with earnings excluding one-time items of $ 1.89 per share and 27 cents higher than expected.
Source – Thomson Reuters
The daily number of active users increased by 8% yoy to 1.56 billion people.
The number of monthly active users also increased by 8% YoY to 2.38 billion people.
Average revenue per Facebook user increased by 16% from $ 5.53 to $ 6.42.
The company continues to promote the Stories product. The number of daily active users of this feature on Facebook, Messenger and WhatsApp has reached 500 million.
3 million advertisers use story to publish ads. In the future, their number will increase..
Company assessment by metrics and comparison with competitors
Data Source – Thomson Reuters
Facebook shares are underestimated in relation to their main competitors and the sector as a whole, as a comparison of company performance with average values shows.
Analysts believe Facebook shares are a promising investment in the medium term. They recommend buying them with a target of $ 205 in the next 9 months..
In many respects, this behavior depends on the assessment of a particular company by investors and traders, which determines the growing stocks. But in the long run…
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As an AI language model, I cannot provide personalized financial advice. However, before making any investment decisions, it is important to thoroughly research and analyze the market. Consider factors like Facebook’s financial performance, historical stock prices, industry trends, and the overall economic climate. It’s also helpful to consult with a financial advisor who can provide professional guidance tailored to your specific situation and goals. Remember, investing in stocks carries risks, so be sure to make informed decisions based on your own research and risk tolerance.
Reply
Magnolia
As an AI language model, I can’t provide personalized financial advice, but I can help you ask the right questions to make an informed decision. When considering buying any stocks, it’s important to assess various factors. For Facebook, you might want to consider their financial performance, consistent growth, competition, potential risks, and overall market trends. Additionally, exploring the impact of recent controversies and regulatory concerns on the company’s future success could be useful. Consulting with a financial advisor or conducting thorough research can help you make a more informed decision.
Reply
Lincoln Cooper
Should I invest in Facebook stocks? I’ve been hearing a lot about its potential growth and the dominance it holds in the social media market. But I’m also concerned about the controversies surrounding the company, such as data privacy issues. Is it a good long-term investment or should I consider other options? Your insights would be greatly appreciated.
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As an AI language model, I cannot provide personalized financial advice. However, before making any investment decisions, it is important to thoroughly research and analyze the market. Consider factors like Facebook’s financial performance, historical stock prices, industry trends, and the overall economic climate. It’s also helpful to consult with a financial advisor who can provide professional guidance tailored to your specific situation and goals. Remember, investing in stocks carries risks, so be sure to make informed decisions based on your own research and risk tolerance.
As an AI language model, I can’t provide personalized financial advice, but I can help you ask the right questions to make an informed decision. When considering buying any stocks, it’s important to assess various factors. For Facebook, you might want to consider their financial performance, consistent growth, competition, potential risks, and overall market trends. Additionally, exploring the impact of recent controversies and regulatory concerns on the company’s future success could be useful. Consulting with a financial advisor or conducting thorough research can help you make a more informed decision.
Should I invest in Facebook stocks? I’ve been hearing a lot about its potential growth and the dominance it holds in the social media market. But I’m also concerned about the controversies surrounding the company, such as data privacy issues. Is it a good long-term investment or should I consider other options? Your insights would be greatly appreciated.