Is Twitter Stock Really the Best Social Media Investment?
The social media landscape has been anything but consistent in the last few weeks. We have seen Facebook stock (NASDAQ: FB) spiral downwards with Snapchat stock (NYSE: SNAP) chart not looking much better. Despite these two social media company’s looking unfavorable from an investors perspective, Twitter stock may be one to consider for long-term gains.
Facebook stock and Snap stock are not to be overlooked long-term, but the challenges that both company’s currently face make them unattractive short-term buys. Looking at the charts, it seems that Twitter stock is the promising social media company in terms of share price gains.
So Why Twitter Stock?
In the social media landscape we have three main contenders, Twitter, Facebook and Snap (Snapchat parent company). To understand why Twitter stock is the more attractive buy right now we need to look at Facebook and Snap.
Twitter is not vastly profitable, but its growth is healthy and shows promising gains. Twitter stock had a strong October, although the wider market suffered some downturn. Twitter stock price (NYSE: TWTR) make significant gains across October due to a strong Q3 report.
Why Not Buy Snapchat Stock?
Snap (Snapchat) is arguably the most unattractive investment out of all three social media companies. Since SNAP’s IPO in March 2017, the company has not performed so well. The IPO saw the Snapchat stock price reach $17 dollars a share, reaching highs of nearly $30. Since then, Snap shares have crashed to around $6.50 per share.
The main problem that we see with Snapchat is the company’s profitability, or lack of it. Despite the app being massively popular, monetization is a major challenge that the company can’t seem to crack. Many analysts now believe that Snap’s IPO was too early in the company’s lifespan.
We expect Snap stock to face immense pressure next year and fight for its survival. To bring Snapchat stock price back up, the company needs to boost user growth and monetization strategies. It is likely that Snap will find more capital in 2019, it is very unlikely that Snapchat stock price will make consistent gains in the near future. When compared to Twitter, it is clear that Twitter stock will be impacted by the success of the platforms monetization strategy.
Is Facebook Stock A Good Buy?
Facebook stock price has fell 23.8 percent since the Cambridge Analytica story went public back in March. In the past eight months we have watch Facebook share price lose almost a quarter of its value.
Small roadbumps have ensured that Facebook stock remains low. For example, Facebook lost its title as “the best place to work” this week. The company fell from 1st to the seventh best place to work. Although it may seem inconvenient, when added to other issues that the company faces, investors lose confidence and selloffs incur.
The main problem with Facebook is its perception amongst investors and the public. Since the Cambridge Analytica scandal, Facebook has been put under a microscope regarding its privacy protocols. These problems mean that Facebook stock is not particularly attractive for investors in the short-term. This leaves Twitter stock.
To conclude, Twitter stock (like all social media platforms), faces its challenges. Although, Twitter shares are a more attractive buy because the issues that the company faces are not a great deal in the overall picture. The factors that caused Twitter stock price to fall in the past are being minimized.
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