The pandemic and the ensuing global lockdowns have brought renewed interest in social media stocks in the stock market. After all, what can people use to connect with friends and family members if not social media? Confined to their homes, many find that social media platforms were the only way to keep in touch with friends and family. And for singles, dating apps become essential to dating, as bars and pubs close at the height of the pandemic.
Former President Donald Trump’s move to create a new social media app also propelled social media stocks into the limelight. As you may or may not be aware, Trump Media and Technology Group and Digital World Acquisition Corp (NASDAQ: DWAC) said that they would partner to create TRUTH Social. The social media app purports to be “free, open and honest”, and vows not to “discriminate against political ideology”. With big money constantly flowing to the social media space, I can understand why many are looking for the best social media stocks to buy. Thus, do you have this list of social media stocks on your watchlist right now?
Best Social Media Stocks To Watch In December 2021
- Twitter, Inc. (NYSE: TWTR)
- Meta Platforms, Inc. (NASDAQ: FB)
- Match Group, Inc. (NASDAQ: MTCH)
- Pinterest, Inc. (NYSE: PINS)
- Bumble Inc. (NASDAQ: BMBL)
Micro-blogging and social networking service company Twitter is one social media stock to watch this week. This came as Jack Dorsey is stepping down as CEO. Parag Agrawal, Twitter’s chief technology officer, will replace Dorsey as its CEO. Investors looking to buy a deeply discounted stock might want to start with Twitter as its stocks have slid more than 40% from February’s peak. Despite its lackluster performance, the company continues to look for new ways to engage customers by creating digital content. Earlier this month, it announced a partnership with S&P 500 Dow Jones Indices to collect sentiment data regarding stocks that make up the S&P 500 Index.
During the third quarter, Twitter recorded $1.284 billion in revenue, up by 37% year-over-year. The company’s advertising revenue totaled $1.14 billion, an increase of 41% year-over-year. Admittedly, its fourth-quarter top-line guidance isn’t exactly exciting, and its daily active user count for the third quarter fell short of estimates. But even at the low end of its fourth-quarter guidance, Twitter is still on pace to grow its revenue to the tune of at least 16%. Given all this, would you scoop up TWTR stock at a discount right now?
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Meta Platforms
Meta Platforms, formerly known as Facebook, is the parent company to many of the most popular social media platforms online. It was rebranded into Meta this year, bringing the word metaverse into popular usage. Metaverse roughly refers to a virtual-reality space in which users can interact with a computer-generated environment and other users in real time. CEO Mark Zuckerberg considers the metaverse to be a successor to the Internet. The company reportedly plans to introduce the metaverse concept to the general public via retail stores. The stores would be used to introduce people to devices made by the company’s Reality Labs division, such as virtual reality headsets.
Meta recorded $29 billion revenue in its third fiscal quarter, up by 35% year-over-year. In particular, its advertising revenues rose by 33.2% year-over-year to $28.28 billion and accounted for 97.5% of the latest quarter revenues. The company said that monthly active users were at 2.9 billion, up 6.2% year-over-year. Considering Meta’s respectable growth rates, would you be investing in FB stock?
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Match Group
Have you used online dating apps? Then you have probably heard of Match Group, the parent company of popular dating apps Tinder and Hinge. Starting off with its namesake Match.com, the online dating conglomerate currently owns the largest global portfolio of online dating platforms. Earlier this month, Match unveiled its plans to create a dating metaverse called Single Town. Single Town’s users will be able to move around and engage with others by audio in various virtual locations using avatars. Match will be working with Hyperconnect, a social discovery and video technology company that it acquired this year, for the metaverse.
In its recently released third fiscal quarter results, Match reported $801.8 million in revenue, up by 25% year-over-year. Direct revenues from Tinder rose by 20% year-over-year. What’s more, paying users on the Tinder app increased to 10.4 million, an increase of 19% year-over-year. With the company’s business emerging strongly from the pandemic, is MTCH stock a top social media stock to watch?
What started as a virtual replacement of paper catalogue is now a popular image sharing and social media platform. Pinterest now clocks over 440 million active users globally. Known as “the only social media company where its users want to be advertised to”, it is a moniker not lost on investors. While PINS stock may have been under pressure for most of the year, could things finally be looking up?
Pinterest reported $632.9 million in revenue from its third fiscal quarter results, up by 43% year-over-year. The company however noted a decrease in active users as the pandemic restrictions eased. Earlier this month, the company announced its own in-house incubator, called TwoTwenty. The incubator will help the company innovate and bring new ideas to the market more quickly. With this in mind, would you buy PINS stock after its recent dip?
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Bumble
Another online dating platform on the list, Bumble markets itself as a women-centric app. This is because in heterosexual matches, only women can send the initial message. The company was founded by Tinder’s former vice president of marketing Whitney Wolfe Herd. As with Match, Bumble also announced that it has plans to dip its toes into the metaverse with its Bumble BFF component. At present, Bumble BFF allows users to find platonic friends instead of dates. Wolfe Herd said that with the planned metaverse, BFF users will be able to create thriving virtual communities.
Bumble’s latest fiscal quarter results showed that revenue increased by 24% year-over-year to $200.5 million. The company said that the Bumble app continued to deliver strong growth with revenue of $142 million, up 39% year-over-year. The number of paid users on the app also recorded an increase of 20% year-over-year to 1.53 million. Furthermore, Bumble raised full-year revenue guidance to the range of $765 to $768 million, up from $752 to $762 million previously. With such strong momentum, could BMBL stock be one of the best social media stocks to buy?
