With 968 million daily active users, Facebook (NASDAQ:FB) is the biggest social network on the planet. And this success reflects in the Facebook stock price, which is up 29% in the year-to-date, as compared to 14.8% gains in the Nasdaq Composite (INDEX:COMPX).
Source: Facebook stock price data by amigobulls.com
To give you an idea of the market’s confidence in Facebook, their IPO was priced at $38, and at time of writing Facebook stock price stood at $94.26 (closing price on Oct 12), a whopping 36% average annual gain over the last 3 years. There are a multitude of factors for this, and we will be discussing them in this article. However, Facebook is still well-placed to grow in the future.
Before we delve into the longterm opportunities for Facebook and its investors, let’s examine what have they done so well.
Forward-thinking strategy
Do you remember when Myspace was the biggest social network on the planet. It seemed as if no one could ever topple the giant. However, they failed to decide on the kind of social network they wanted to be, and the user experience suffered as a result. As a result, Facebook were able to come in with a streamlined and clean interface, and take the crown.
Additionally, on the mobile-front, Mark Zuckerberg and company were able to foresee that with rising internet speeds, and increased smartphone uptake; mobile networking would be huge. As a result, Facebook made sure that they had an app on every mobile platform and had a simple low-bandwith mobile version, which has helped Facebook’s penetration.
It is this forward-thinking and user driven approach which has stood this company in good stead.
Leave A Comment