The social media sector is a vibrant and rapidly evolving segment of the technology industry, comprised of companies that facilitate digital interactions among users through various platforms. These platforms range from networking sites like Facebook and LinkedIn to multimedia-sharing platforms such as Instagram and YouTube. The sector is characterized by its vast reach, with many platforms boasting user bases in the hundreds of millions or even billions, and its potential for significant growth as internet accessibility and digital marketing continues to expand globally.
Investing in social media stocks means buying shares in these companies, and it can be an attractive proposition for several reasons. Firstly, social media usage continues to climb, creating a vast and growing market for these platforms. Secondly, the digital advertising market, a key revenue stream for social media companies, is also on a growth trajectory as businesses increasingly shift marketing dollars from traditional channels to online ones.
However, investing in social media stocks comes with its own set of risks. The sector is subject to changing user preferences, significant regulatory scrutiny, and intense competition among platforms. As with any investment, potential investors should conduct thorough research and consider the risk factors unique to this dynamic and highly visible sector. Bearing this in mind, here are two social media stocks to check out in the stock market now.
- Meta Platforms Inc. (NASDAQ: META)
- Pinterest Inc. (NYSE: PINS)
Meta Platforms (META Stock)
Starting off, Meta Platforms (META), previously known as Facebook Inc., is one of the world’s leading social media companies. The company’s products include Facebook, Instagram, Messenger, WhatsApp, and Oculus, among others.
Last month, Meta Platforms reported a beat for its second quarter of 2023 financial results. In detail, the company announced Q2 2023 earnings of $3.23 per share along with revenue of $32.00 billion. This is in comparison with analysts’ estimates for the quarter which were earnings of $2.87 per share with revenue of $31.06 billion. Meanwhile, revenue advanced by 11.02% versus the same period, the prior year.
In the last six months of trading, shares of Meta Platforms stock have grown by 60.98%. Meanwhile, on Friday morning, META stock is trading lower off the open by 2.84% at $276.98 a share.
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Pinterest (PINS Stock)
Next, Pinterest (PINS) is a unique social media platform that allows users to discover, share, and save creative ideas through images, videos, and links, known as Pins. Pinterest has grown to become a major player in the social media space, attracting users who are looking for inspiration in various areas such as fashion, home decor, cooking, and more.
At the beginning of this month, Pinterest announced a better-than-expected second quarter of 2023 financial results. Diving in, the company reported Q2 2023 earnings of $0.18 per share on revenue of $708.03 million. This is versus Wall Street’s consensus estimated earnings was $0.12 per share along with revenue of $695.64 million. Moreover, revenue gained by 6.32% on a year-over-year basis.
In the last six months of trading, shares of PINS stock have increased by 7.10%. Meanwhile, during Friday morning’s trading session, Pinterest stock is trading lower on the day so far by 1.93% at $26.19 a share.
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