Will Facebook Inc (FB) Stock Follow in Line With Twitter’s (TWTR) Fall?


Over the past few months, we’ve seen shares of Facebook Inc (NASDAQ:FB) stock climb, while shares of Twitter (NYSE:TWTR) have seemingly taking a huge plunge. When we compare the two companies, one has to wonder if Facebook may one day soon see the same issues that Twitter is going through today.

Facebook Inc (NASDAQ:FB) continues to grow as a social network, and the company continues to buy out smaller firms on a consistent basis. However, the same could have been said for Twitter (NYSE:TWTR) just a year ago. Suddenly, however, Twitter is trading at a low previously unthought of, and their member use has leveled off. At some point, Facebook will see their growth level off as well. While this could happen soon or it may be 10 years before we see user activity slow down, we must all realize that there is no way for them to continue to grow their member base in the long run. Facebook, however, offers much more to their users than Twitter does. Twitter is greatly limited in what users can share, and what they can do within the social platform.

Facebook is in a good position when it comes to opportunities to expand. They can add new features and new applications in areas where Twitter can not. This means users spend more time on the site, and see and click on more advertisements, leading to greater revenues for the company.

Facebook will one day face a similar situation to Twitter, in that member numbers will stop growing, but it’s my opinion that they are better equipped for when this happens, and it won’t be for quite some time. While there is no ruling out that Facebook will face similar problems that we see Twitter facing now, it’s my feeling that they will be able to avoid some of the pitfalls that Twitter has experienced.

The stock closed at $101 during the last trading session. It is up 17.92% since July 8, 2015 and is uptrending. It has outperformed the S&P500 by 27.39%.

From a total of 34 analysts covering Facebook (NASDAQ:FB) stock, 33 rate it a “Buy”, 1 a “Sell”, and 0 a “Hold”. This means that 97% of the ratings are positive. The highest target price is $170 while the lowest target price is $88. The mean of all analyst targets is $125.06 which is 23.82% above today’s ($101) stock price. Facebook was the topic of 66 analyst reports since July 21, 2015 according to the firm StockzIntelligence Inc. Piper Jaffray maintained shares on January 28 with a “Overweight” rating. Suntrust Robinson maintained shares with a”Buy” rating and a $120 target share price in their report from a January 25. Stifel Nicolaus maintained FB stock in a recent report from January 28 with a “Buy” rating. Morgan Stanley maintained the rating on November 5. Morgan Stanley has a “Overweight” rating and a $120 price target on shares. Finally, FBR Capital maintained the stock with a “Outperform” rating in a report they issued on a January 28.

The institutional sentiment increased to 1.73 in Q2 2015. It’s up 0.01, from 1.72 in 2015Q2. The ratio is positive, as 69 funds sold all their Facebook Inc shares they owned while 375 reduced their positions. 126 funds bought stakes while 643 increased their total positions. Institutions now own 1.55 billion shares which is 2.48% more than the previous share count of 1.51 billion in 2015Q2.

Millennium Tvp Management Co. Llc holds 52.76% of its total portfolio in Facebook Inc, equating to 639,552 shares. Parametric Risk Advisors Llc owns 7.97 million shares representing 46.51% of their total US portfolio. Moreover, Sc Us (Ttgp) Ltd. has 41.15% of their total portfolio invested in the company, equating to 1.04 million shares. The California-based Meritech Capital Associates Iii L.L.C. has a total of 37.81% of their portfolio invested in the stock. Duquesne Family Office Llc, a New York-based fund reported 4.09 million shares owned.

Since February 25, 2015, the stock had 0 buys, and 32 sales for a total of $57.08 million in net activity. Athwal Jas sold 30,000 shares worth $3.06M. Stretch Colin sold 1,000 shares worth $98,710. Cox Christopher K sold 5,778 shares worth $561,622. Schroepfer Michael Todd sold 31,283 shares worth $3.00 million. The insider Fischer David B. sold 15,000 shares worth $1.43 million.

Facebook, Inc. is a social networking company. The company has a market cap of $291.69 billion. The Firm is engaged in developing products that enables users to connect and share through mobile devices and personal computers. It has 78.3 P/E ratio. It offers various services focused on people, marketers and developers.