A Look at Where Social Media is Headed and How it Relates to the Market

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Dec 03, 2014
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Social media is constantly evolving, as we have seen with Myspace and Facebook (FB, Financial), when the phenomena of social networking became popularized. Social media started off as a platform that allowed people to share information about themselves, including their thoughts and personal pictures, with other users. In 2013, it became more visual, as Instagram and Snapchat became popular. Now, it is shifting in a new direction. Social media is beginning to become something that allows people to connect on a more personal level, sharing opinions and advice, or even personal items, with complete strangers in need.

Take the mobile app Rent anything that allows users to rent anything from surrounding neighbors, from rooms in the house to appliances.

Most of these new apps emerging on the social media platform have not forgotten about the social media giants, however. A lot of them suggest for you to use your Facebook or Twitter (TWTR, Financial) account to sign in, or ask you to share your post on other social media sites.

The app Pheed, for example, which encourages users to share information about certain topics and other users are able to “trust” information shared from other users. The site then asks if you would like to share your post on LinkedIn or Facebook.

Up-to-date stock information on social media sites

Facebook’s stock price is currently $74.75 and is down by 0.94%. The company’s financial strength has a high score of 9 out of 10. Profitability & Growth also scored high at 7 out of 10.

Gurus that recently purchased this stock, or added shares to their profiles include: Steve Mandel, John Burbank, Andreas Halvorsen, Caxton Associates, Jim Simons, Pioneer Investments, Mario Gabelli, Ray Dalio and Ken FIsher.

Gurus that sold or reduced shares include: Stanley Druckenmiller, Julian Robertson, George Soros, Kyle Bass, Steven Cohen and Louis Moore Bacon.

Ron Baron had positive things to say about Facebook. "We continue to believe that Facebook is in the early of building out its global advertising business. The company has an attractive customer and stands to benefit from expected improvements in the price of advertising on its platform. Its recent acquisitions of Instagram and WhatsApp provide further growth opportunities and possible synergies with the Facebook network."

The most recent insider trades were all sells, including but not limited to: Chief Product Officer, Christopher K Cox, sold 5,934 shares at $75.58 and also sold 41,404 shares at $73.58 November 24; Colin Stretch, VP Gen. Counsel & Secretary, sold 1,000 shares at $74.18; David B. Fischer, VP of Marketing and Business Partner sold 61,547 shares at $74.45.

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Google Inc (GOOG, Financial)'s stock price is $530.97, down by 0.52%. The company has a financial strength score of 8 out of 10 and a profitability and growth score of 8 out of 10 as well.

Guru Robert Karr recently added Google to his profile and was the only guru who recently bought this stock. Other gurus sold out or reduced, such as: Stanley Druckenmiller, Julian Roberts, Bill Nygren, George Soros, Jeremy Grantham, John Griffin, Frank Sands, David Winters, Caxton Associates and Steven Cohen.

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The most recent insider trades have been sells. the co-founder and 10% owner sold shares twice this week. The first time he sold 103,426 shares at $536.79 and the second time he sold 63,242 at $533.26. Director John Doerr sold 7,759 shares at $537.04; Page Lawrence, CEO and 10% owner, sold 33,340 shares at $549.13.

Yahoo! Inc (YHOO, Financial) is currently priced at $50.87 and is up by 0.39%. Financial strength is a 7 out of 10 and profitability and growth has a score of 5 out of 10.

Here's a look at the most recent guru trades:

Buys/adds: John Burbank, George Soros, First Pacific Advisors, Caxton Associates, RS Investment Management, Dodge & Cox.

Sells/Reduce: Louis Moore Bacon, Pioneer Investments, Steven Cohen, Paul Tudor Jones and Jim Simons.

CEO Marissa Mayer recently sold 36,000 shares of this stock twice, the first time on November 12 and the second time was on November 25. She now owns 2,311,818 shares in this company. Below is a chart that shows insider trades as a whole, not just Mayer's buys and sells with the company.

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Twitter is $38.95 and up by 0.1%. Financial strength is scored at 7 out of 10, but profitability and growth have a low score of 1 out of 10.

Gurus that recently bought/added this stock to their profiles include: Louis Moore Bacon, Steven Cohen, Paul Tudor Jones, Pioneer Investments and RS Investment Management.

Gurus that sold out/reduced this stock were: David Swensen, Chris Davis and George Soros.

November marked the highest insider sells ever, with a total of 14 sells and an ending price of $47.14. So far this month, there has only been one insider trade so far: CEO Richard Costolo sold 141,730 shares at $40.07. He now owns 545,856 shares of this stock.

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This chart shows insider sells in relation to the price of the stock.

LinkedIn Corp (LNKD) is $218.15, up by 1.45%. Financial strength is 7 out of 10 and profitability and growth is on the lower end, with a score of 4 out of 10.

Two gurus recently purchased this stock: John Griffin and Jim Simons.

Frank Sands, Manning & Napier Advisors, Inc. and George Soros all reduced the number of shares of this stock in their portfolios and Steven Cohen sold this stock.

In recent insider trades news, Director David Sze sold 1,500 shares this month, leaving him with 57,866 shares. The highest number of shares sold by an insider was from CEO Jeff Weiner who sold 45,635 shares, leaving him with 238,025 shares of this stock.

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Here's a look at insider trades over the past few years.

One way to compare companies is to look at four categories: the dividend yield, P/E ratio, PEG ratio and P/B ratio. This is only effective when comparing companies in the same industry and we actually do so for you if you click on Definitions on any company page. Type in any of the ratios mentioned, and we will show you where that company is placed in relation to other companies in the same industry.

Below, I will be comparing a small fraction of the social media sites in the Global Internet Content and Information industry.

Social Media P/E ratio comparison

In comparison to other media sites, Facebook's P/E ratio of 71.80 is ranked higher than 72% of the companies in the Global Internet Content and Information industry. The industry median is at 106.00.

As shown in the chart below, Google's P/E ratio of 28.20 is ranked higher than 83% of companies in the same industry.Yahoo!, LinkedIn and Twitter have P/E ratios on the lower end, with Twitter and LinkedIn's at 0. Yahoo!'s is at 6.7.

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A look at PEG ratio comparisons

Facebook,LinkedIn and Twitter have PEG ratios at 0.0, which is higher than 70% of the companies in the same industry. Yahoo! has a PEG ratio of 0.25, but Google takes the gold in this category, with a PEG ratio at 1.87, which is higher than 93% of the companies in the same industry.

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Dividend yields

Facebook and LinkedIn's dividend yield is at 0.00, which is significantly lower than other companies in the same industry. Other companies with a dividend yield at 0.00 include: Twitter, Yahoo! and Google.The industry median is at 1.18, making both Facebook and LinkedIn lower than 205% of companies in the industry.

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Lastly, where are the P/B ratios at?

LinkedIn and Facebook's P/B ratios come close, but Facebook came in first with a P/B ratio of 9.2. LinkedIn's is 9.0. Twitter did not fall too far behind, however, with a P/B ratio is 7.1. Google's was on the lower end, at 3.7 and the lowest was Yahoo!'s at 1.4.

Although Google's P/B ratio ranked lower than the other sites, it's still a good sign because it is close to the 1-year low of 3.59.

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