Overall, social media stocks continue to perform well as we settle into 2021.
Social media companies continue to attract users and investors even as the broader technology sector has slowed down in recent months, and once high-flying tech stocks have stalled. A report shows that 70% of the U.S. population has at least one social media profile today. And by the end of this year, the number of worldwide social media users is expected to grow exponentially.
So, if anything, social media is accelerating not slowing down. And with that in mind, here we look at four social media stocks blowing up your phone.
Now, let’s dive in and take a closer look at each one.
Social Media Stocks Blowing Up Your Phone: Twitter (TWTR)
Arguably the most widely used and influential social media platform is Twitter. And the California-based company’s stock has been on an upswing since mid-January, rising 33% in that time to $60.24 per share. The increase came after the platform banned former President Donald Trump following the riots on the U.S. Capital, and as fears subsided that many individual Twitter users and political groups would boycott the social media company in the wake of Trump’s ban.
Now, TWTR stock is getting a further bump ahead of its full year 2020 financial results that will be released after market close on Tuesday. Moreover, Twitter also announced that it is acquiring Revue, an online platform focused on people who publish their own newsletters. The deal is aimed at building subscription revenue for Twitter, which will receive 5% of all the subscription revenue generated by users of Revue.
Investors focused on growth should add PINS stock to their portfolio. Pinterest’s share price has been moving straight up over the past year, rising 530% since last March to its current price of $80.20.
At the depths of the novel coronavirus pandemic last spring, Pinterest stock was changing hands at $10.10 per share. The stock price started rising in early April and has kept on going. And aside from a minor dip in early November, the social media company’s stock has climbed straight upwards and handsomely rewarded its shareholders in the process.
Fueling the growth has been the steady increase in the number of people using the Pinterest platform, called “Pinners” by the company. According to the company’s recent report, Pinterest’s user base stood at 459 million monthly active users at the end of 2020’s fourth quarter, up 37% from the same quarter of 2019. That’s an impressive number of loyal users. However, 361 million of those 459 million total users are international — meaning more growth is possible in the U.S.
Now, all eyes are now on Pinterest and its movement post-earnings.
Social Media Stocks Blowing Up Your Phone: Snap (SNAP)
If there’s one social media stock that has given PINS stock a run for its money over the past year, it is Snap. Since its bottomed last March, SNAP stock has ballooned 600% and today trades at $62.55 per share. And the stock is up 18% since the end of January.
That said, the steady growth is impressive and continues to defy expectations. Like many of the largest social media companies, Snap, which owns and operates services such as Snapchat and Bitmoji, has thrived during the pandemic as people sheltered at home and communicated more through social technology platforms.
Other things putting wind in the sails of Snap are its growing augmented and virtual reality products, mobile video games and its content partnerships with the National Football League (NFL), Walt Disney (NYSE:DIS) and stand-up comedians such as Kevin Hart. In turn, Wall Street analysts are increasingly looking at Snap as a diversified entertainment company that is leading in social media and the broader technology sector. Most recently, Snap has announced a new “Spotlight” feature that it plans to use to challenge rival Chinese social media company TikTok.
Although largely seen as a villain in the social media space, Facebook is undeniably still a giant among social media stocks.
The platform is accused of being used to spread disinformation and lies, particularly related to politics, and Facebook’s leadership has been lambasted for not doing enough to clean-up the site and remove false and misleading posts from groups as diverse as U.S. dissidents to Russian agents. That said, Facebook CEO Mark Zuckerberg has become the poster boy for callous tech leaders.
The negativity has pushed FB stock down 3.5% since it peaked in early September at a 52-week high of $304.67 per share. Yet, investors shouldn’t give up on Facebook just yet. The company remains an online advertising behemoth, generating nearly $70 billion a year in revenue. Plus, the company has taken steps to remove disinformation from its platform, even though it hasn’t gotten a lot of credit for it. And, perhaps most importantly, Wall Street continues to support Facebook. Analysts have a median price target on the stock of $350 per share, with a high estimate of $418. The median estimate represents a 29.5% increase from it recent share price.
Thus, think buying opportunity!
On the date of publication, Joel Baglole held a long position in DIS.
Joel Baglole has been a business journalist for 20 years. He spent five years as a staff reporter at The Wall Street Journal, and has also written for The Washington Post and Toronto Star newspapers, as well as financial websites such as The Motley Fool and Investopedia.