Facebook (NASDAQ:FB) stock has seen its worst year since its IPO in 2012. The social media giant struggled as it dealt with the fallout from alleged scandals. It also suffered the largest market cap loss sustained by any company in the history of the market after its last earnings report. Facebook stock has fallen further from this point. It now trades more than 26% below its 52-week high.

However, despite the bearish sentiment, FB and the sites it owns dominate the social media landscape. As our own Luke Lango points out, four of the six social media apps with over one billion users belong to Facebook.

Given the falling multiple and the remaining growth, investors should look at this bad year for the company as an opportunity to buy.

Facebook Dominates Social Media

The pessimism on FB stock is overdone. Yes, the company faces challenges. The fallout from the Cambridge Analytica scandal, as well as accusations about political bias and Russian collusion, have weighed on the stock.

However, the market also should gain some perspective. Facebook owns the ecosystem that dominates social media. Four of the most popular apps in existence, Facebook, Messenger, Instagram, and WhatsApp, all operate within this ecosystem.

Sure, other sites exist, but only as niches. Twitter (NYSE:TWTR) holds a following with figures in entertainment. Snap (NYSE:SNAP) remains popular with the young. LinkedIn, owned by Microsoft (NASDAQ:MSFT), succeeds by owning the career niche.

Chinese equivalents such as Weibo (NASDAQ:WB) and QQ, which is owned by Tencent (OTCMKTS:TCEHY), operate in a market protected from American competition.

Still, none of these sites pose a danger to Facebook. In fact, Facebook has become so dominant that Alphabet (NASDAQ:GOOGL, NASDAQ:GOOG) stands as its most significant threat, as both depend on online ads for most of their revenue.

Growth Concerns Years off

As chartists like to point out, Facebook stock finds itself in a brutal downtrend. In the near term, it could fall further. However, this swoon turns FB stock into a buyer’s dream. The forward price-to-earnings (PE) ratio stands at just over 22. Wall Street also predicts net income growth will average 22.2% over the next five years.

Also, how many companies face the issue of growth limits because they have attracted over 30% of the world’s population? With that level of penetration, many can see FB becoming positioned like Coca-Cola (NYSE:KO) and left no new markets left to tap. Still, achieving such a feat remains years off.

Moreover, investors should remember that one of the strongest balance sheets in corporate America backs up Facebook stock. That balance sheet shows over $42 billion in cash as of the end of the second quarter. This should leave FB the funds it needs to buy the new revenue sources it cannot invent itself.

Investors should remember that Facebook acquired Instagram and WhatsApp in such a manner. Both were integrated into the FB ecosystem with great success. I believe the company can repeat this process if growth prospects begin to dim.

The Bottom Line on Facebook Stock

Investors should treat the bear market in Facebook stock as an opportunity to buy. Yes, the company has faced serious challenges. As such, the stock has fallen by more than 26% in less than two months.

However, as the stock has trended downward, it has become more of a bargain. Also, investors should remember that forecasts for double-digit growth remain in place.

Moreover, they should understand the power of Facebook’s ecosystem. Not only has it dominated its industry and become an advertising powerhouse, but it has also generated the cash needed to absorb new platforms into its ecosystem.

The downtrend in Facebook stock continues. However, the next earnings report will likely go over better than the last one. Whether or not that report breaks the downtrend, it should return to growth, greatly benefitting investors who bought FB stock at discounted prices.

As of this writing, Will Healy did not hold a position in any of the aforementioned stocks. You can follow Will on Twitter at @HealyWriting.