The evolution of the social media landscape and the emergence of ideas such as the metaverse has opened the door for these strong buy social media stocks to flourish.
The companies discussed in this article are all disrupting the social media industry in different ways, each bringing different strengths.
From innovative content creation platforms to immersive virtual experiences, these companies are reshaping how we connect and interact online. Investing in these forward-thinking companies could yield significant returns as the digital realm continues to expand.
So here are three strong buy social media stocks for investors to consider.
Meta Platforms (META)
Meta Platforms (NASDAQ:META) has set ambitious goals for 2024, continuing its trajectory of strong performance from 2023. The company’s renewed focus on AI may give it that vital growth driver it needs to surge past its competitors.
There are many reasons why I believe that META is one of those “Strong buy’ social media stocks. Firstly, it’s doing its best to reduce expenses through its “year of efficiency” for 2024. This strategic focus resulted in a better-than-expected expense guidance, projecting a growth of 14.5% from the prior year.
Estimates for 2024 suggest a profit margin of 29.4%, an improvement over 2023 margins. Improved free cash flow margins are also anticipated, with analysts expecting a 22.15% increase in its EPS for FY2024.
This then makes META a strong buy in my book.
Snap (SNAP)
Although Snap (NYSE:SNAP) is suffering from some competitive headwinds as younger consumers flock to trendier apps such as TikTok, I believe that SNAP will ultimately prevail victorious thanks to the continued success it has seen in virtual and augmented reality and its expanding advertising platform.
Looking ahead to this year, Snap aims to surpass 475 million daily active users (DAUs) in 2024, which is above Wall Street expectations. Part of the app’s appeal is its extensive range of augmented reality lenses, with over 350,000 AR creators and developers creating nearly 3.5 million of them at the time of writing.
SNAP’s immediate-term financial outlook is also robust, as advertising revenue is expected to grow more than 20% in 2024. This growth is part of Snap’s “stretch goals” and surpasses Wall Street estimates of 14%.
Snap anticipates revenue between $1,095 million and $1,135 million for the next quarter, indicating an 11% to 15% year-over-year growth. Adjusted EBITDA is estimated to be between negative $55 million and negative $95 million.
Overall, These developments position SNAP as an enticing option for investors and are why I rate it as one of those strong buy social media stocks.
Pinterest (PINS)
Pinterest (NYSE:PINS) operates a social media site that allows users to discover, share and save visuals as pinboards. It was trendy in the early Web 2.0 days and has since undergone what I consider to be a resurgence of interest in the platform.
The platform has seen an 8% year-over-year increase in Global Monthly Active Users (MAUs) in the second quarter of 2023, with mobile MAUs, which constitute 80% of impressions, growing by 16%.
On the monetization front, things are also looking up for PINS stock. Namely, it’s rolling out solutions to increase clicks, conversions and ad pricing. A substantial part of this strategy is the shift from acting as a retailer to partnering with retailers with brands such as Amazon (NASDAQ:AMZN).
Pinterest’s Q3 revenue of $763 million, up 11% year-over-year, signals a continued acceleration in growth, with ad impressions increasing 26% year-over-year. For Q4, Pinterest expects revenue growth of 11-13% over the same period.
PINS is one of those strong buy social media stocks to consider when trading at just 9.38 times sales and in light of these positive developments.
On the date of publication, Matthew Farley did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
