Investors remained faithful for Facebook (FB) shares, after CEO Mark Zuckerberg said he would not be selling shares. Facebook managed to rise 4.79% to $18.58 on September 5, breaking a downward spiral in its shares that began in early July. Investors should note that Zuckerberg already sold $1.1 billion worth of stock after the company IPO’d.
On the positive side, Facebook’s decision to use cash and lending facilities to pay for its tax bill will reduce the total shares outstanding by 101 million. On Kapitall, Facebook is one of the most actively viewed and traded stock, albeit a small allocation of total holdings for Kapitall investors.
Kapitall investors should note November 14th on their calendar: the lockup expiry for 1.09 billion shares of Facebook will end that day. Facebook will also let employees sell 234 million shares on October 29, instead of the original November 14.
Facebook is due to report earnings on October 23.
What Ad Strategy?
Pundits and analysts continue to believe Facebook will grow revenue via mobile-advertising, but this view is flawed. If advertisers were to realize that mobile ad clicks disrupt the user experience, they would infer that the majority of clicks happen accidentally. Facebook still needs to enhance its mobile facebook app. Although Facebook’s update to its app on Apple (AAPL) is improved, much work is still needed for the Facebook Android App. Functions as basic as copying and pasting text, for example, does not work.
eMarketer still thinks Facebook could generate around $73 million from mobile advertising this year, and $387 million next year. Investors should treat that forecast with skepticism.
Below are the social media companies to look at. To get a snapshot for each company, click on the company icon. To get more detailed fundamental information on any of the companies, open the snapshot and select “number cruncher.”
3. Groupon, Inc. (GRPN, Earnings, Analysts, Financials): Market cap at $2.73B, most recent closing price at $4.18. Groupon is focusing on Groupon Goods, Groupon Now!, and Groupon Getaways. A third of Groupon’s transactions came from mobile apps in Q2.
4. Yelp, Inc. (YELP, Earnings, Analysts, Financials): Market cap at $1.58B, most recent closing price at $25.77. Yelp rallied from $18 to around $26 in recent trading sessions despite the lockup period ending on August 29. Mobile advertising is strong for Yelp, with 25% of unique visitors coming from mobile devices.
5. LinkedIn Corporation (LNKD, Earnings, Analysts, Financials): Operates an online professional network. Market cap at $11.97B, most recent closing price at $113.28. Analysts think LinkedIn beat expectations in Q3. LinkedIn is performing well in all of its business segments.
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- Facebook, Inc. (FB, Chart, Download SEC Filings)
- Zynga, Inc. (ZNGA, Chart, Download SEC Filings)
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- Yelp, Inc. (YELP, Chart, Download SEC Filings)
- LinkedIn Corporation (LNKD, Chart, Download SEC Filings)
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