Best Growth Stocks for Retirement: Facebook (FB)
I’ll admit, Facebook Inc (NASDAQ:FB) might be a risky long-term bet. Social media is still new, and it’s hard to imagine what an industry that barely existed a decade ago will look like 20 or 30 years from now.
Founder Mark Zuckerberg has been compared to a young Bill Gates, both for his vision and for his ruthlessness. But Gates’ primary businesses — the Windows operating system and Office productivity suite — had much deeper competitive moats at this stage of the game for Microsoft. Gates enjoyed virtual monopoly power during the PC’s days of dominance, and switching costs were prohibitively high for most computer users.
Social media is more prone to disruption, as can be seen with the swiftness with which Facebook buried social-media pioneer MySpace, and the tenacity with which it’s going after Snap. That said, Zuckerberg is not the type to sit idly by while the world around him changes. FB has been very aggressive in adding new features to its core site to keep users engaged and even more aggressive in seeking out new opportunities, such as Instagram and WhatsApp.
And Facebook’s network effects (i.e., the pressure to and need to join if all of your friends and family are on it) are a competitive moat that gets a little deeper each day.
If you’re looking for long-term growth, Facebook would seem to be a very decent bet.