Gublo
Small/Mid-Cap Trader, Multibagger/Penny Stocks, Earnings Analysis & Signals
Social media stocks look worth buying because they trade at a discount while people stay hooked on social media. Usage is now a permanent part of life that cannot be taken away, contrary to @CryptoDan007's prediction that it will come to be seen as a low-class pastime. That makes Meta, Reddit, Pinterest and Snap all candidates to buy. x.com x.com
The social-media selloff looks way overblown, because AI makes these companies leaner and more profitable rather than disrupting them. Reddit is the clearest case at about 24x forward EV/FCF with 91% gross margins and 52% growth, despite being down 44.6% this year; Pinterest is down 32.2%. Meta's capex draws bear cases, but forward revenue growth of 30-33% at about 17x forward earnings shows that spending is delivering ROI. These are buys, held with some confusion. x.com
Meta's Instagram and Facebook stand to gain ad dollars as Google Search erodes because attention is shifting to quasi-entertainment platforms with authentic reach at scale. That shift is already starting and should continue: more time on Meta's platforms can attract more advertisers, accelerating both sides of the flywheel. Meta Muse offers another opportunity to use the platforms' personalized insights for results involving tasks, queries and transactions. x.com
Social media bans for young users, now introduced in the UK after Australia, should hurt Snap far more than Meta. Apps in general are unappealing investments. x.com
Meta, the world's most dominant social media empire, is on sale. It owns Instagram, Facebook and WhatsApp, each with about 3 billion monthly users. x.com
Meta looks attractive for its highly profitable, sticky Facebook, Instagram and WhatsApp business, AI momentum and valuation. Muse already has 2.5 million daily active users, and shares trade at 24.4 times trailing earnings. Founder-CEO Mark Zuckerberg retains voting control; his big wins easily outweigh his mistakes, and at 42 he could have another 30 years of execution ahead. x.com x.com
Meta's Muse market sizing may overstate adoption because it extrapolates from some of the most productivity-focused users on earth to consumers who enjoy browsing and may not want an assistant to replace discovery. Heavy capex, unproven technology and product-market fit, unclear ROI and an arguably weaker moat raise the risk of another metaverse-style spending mistake. x.com x.com x.com
Meta's monetization advantage is enormous. Its average revenue per person has risen 62% since Q2 2023 to $16.90, nearly 3x Reddit's and more than 5x Snap's. AI spending is the risk, but this monetization engine helps fund that bet, making Meta one of seven stocks worth buying today. x.com x.com
Reddit should have a huge 2027. It is a better company than Pinterest both fundamentally and technically, as its financials show. x.com x.com x.com
Reddit carries Pinterest-like downside to a 10x P/E if investors decide North American user growth is toast, while the stock is priced on everyone playing for big numbers from new lab deals. x.com
Meta's Muse agent has the best possible setup because it sits inside apps billions of people already open every day. Muse is No. 1 in the App Store, its downloads have passed Instagram and Facebook, and it has four partnerships two weeks after launch, while other labs must persuade users to download something new. After a 35% rise in a month, the stock likely needs some consolidation. x.com x.com
