3 Stocks That Are Better Than Facebook

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Chances are that you have to allocate your investing dollars wisely and where you think you’ll get the best payoff. So, should you put your money on Facebook? Or might it be another company?

I actually think investors can find some much better deals to choose from — without worrying about the fickleness of Internet fads, upstart competitors — which are getting tons of venture capital — as well as giant rivals like Google (NASDAQ:GOOG). Besides, in the Facebook S-1, Mark Zuckerberg does write: “we don’t build services to make money; we make money to build better services.” Yes, this may be scary for some investors.

So what might be some other stocks to consider? Here’s my shortlist of those with a market cap similar to Facebook’s estimated $100 billion:

ConocoPhillips (NYSE:COP) — $92 billion market cap.

Let’s face it, the world is having a tougher time finding oil reserves. Yet the demand continues to grow, especially in countries like China.

In the latest quarter, Conoco’s profits came to $3.39 billion while revenues increased by 17% to $62.39 billion. The company also plans to spin off its refining division, which will generate cash to pay down debt and allow for more focus on deepwater exploration.

Finally, Conoco has a juicy dividend, currently at 3.8%.  In other words, if you bought Conoco for $92 billion, your annual distribution would be $3.5 billion.  That should be enough for any kind of lifestyle.

Oh yeah, Berkshire Hathaway’s (NYSE:BRK.A) Warren Buffett, who is probably still worth more than Facebook’s Zuckerberg, holds 2.19% of the stock.

McDonald’s (NYSE:MCD) — $100 billion market cap.

As seen recently, the company has had some snafus with its social media marketing campaigns. But it’s something that Mickey D. will definitely learn from. When it comes to building a brand, few are better than McDonald’s.

And as InvestorPlace.com contributor Gene Marcial points out, the company is really the Apple (NASDAQ:AAPL) of fast food. And unlike Facebook, it also has a thriving business in China.

Despite the sluggishness in the global economy — especially in Europe — McDonald’s still finds ways to crank out growth. In November, global comparable sales growth came to 7.4%.

What about a dividend? The current yield is 2.8%.

QUALCOMM (NASDAQ:QCOM) — $103 billion market cap.

Yesterday, Qualcomm reported a blowout quarter. Revenues soared by 40% to $4.68 billion, with profits coming to $1.4 billion, or 81 cents per share. The company sees next quarter’s revenues at $4.6 billion to $5 billion, which compares to the analyst consensus of $4.51 billion.

Of course, Qualcomm is getting a lift from its Apple business, and it has lots of strength in India and China. So, in light of the expected momentum in the smartphone market, Qualcomm is likely to continue to post high-performance results. By contrast, Facebook makes virtually nothing from its mobile business.

Something else: Qualcomm even has a decent dividend yield of 1.5%.  Don’t expect a dividend from Facebook anytime soon.

Tom Taulli runs the InvestorPlace blog IPO Playbook, a site dedicated to the hottest news and rumors about initial public offerings. He also is the author of “All About Short Selling” and “All About Commodities.” Follow him on Twitter at @ttaulli. As of this writing, he did not own a position in any of the aforementioned securities.

Tom Taulli is the author of various books. They include Artificial Intelligence Basics and the Robotic Process Automation Handbook. His upcoming book is called Generative AI: How ChatGPT and other AI Tools Will Revolutionize Business.


Article printed from InvestorPlace Media, https://investorplace.com/2012/02/three-stocks-that-are-better-than-facebook/.

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