- Should you buy Facebook Stock (FB) stock now? Here is some information to help you decide.
Facebook, Inc. (NASDAQ: FB) stock has been surging over the last few months despite the economic crisis associated with the COVID-19. In the past 3 months, the company’s stock price increased by about 17% from $196.44 to $225.09. Due to the growth of Facebook’s stock, Mark Zuckerberg had become the third richest person.
Option For Employees To Work From Home Permanently
Facebook CEO Mark Zuckerberg recently said that some employees will have an option to work from home on a permanent basis. This was announced during an internal employee town hall meeting that was live-streamed on Facebook. And Zuckerberg said that over the next five to ten years, around half of Facebook’s workers could be remote.
However, the employees will be eligible to permanently work from home if they are experienced and have strong recent job performance. Plus they have to be part of a team that supports remote work and approval is required from a group leader.
Facebook will also set up new hubs in Atlanta, Dallas, and Denver. These hubs will enable workers to support each other in those locations. And then Facebook will eventually create physical spaces for workers to gather.
The Facebook headquarters in Menlo Park, California is not expected to open until July 6 at the earliest and workers will be required to get their temperatures checked and wear face masks. Plus they will have to practice social distancing. At that time, Facebook is also going to initially limit the capacity to 25%.
Some of the Facebook employees who are unable to work remotely include the ones involved in hardware and content review. And the salary of employees will change if that person moves to a new location.
According to a Bloomberg report, Instagram is working on a new platform that will enable creators to directly profit from videos. Next week, Instagram will start showing ads before clips on the IGTV service. IGTV is known for streaming longer-form videos.
The report says that Facebook will share 55% of the revenue with the creators. This is the same percentage that YouTube shares with its creators.
And Instagram is also testing the ability to sell digital badges. When a viewer buys a badge, their name will stand out in the comments. The badges will be priced at 99 cents, $1.99, and $4.99. And the badge will appear during the duration of the video. The badges are a test and Instagram could potentially still change directions.
Video creators will receive all the money directly for the first few months of the test and then Instagram will start taking a share of the revenue later in 2020 or in 2021.
“This has been a trying time, where creators have been there for their fans,” said Instagram chief operating officer Justin Osofsky via Bloomberg. “It’s a time of uncertainty with less paid work generally.”
Instagram has been seeing a jump in video usage. Live videos jumped 70% from February to March. But creators have been flocking more towards YouTube since there are more ways to make money on that service.
Workplace Rooms Gains Video Conferencing As Paid Users Hit 5 Million
Recently, Facebook added new features to the Workplace platform as the number of paid users jumped to five million through the end of March. This is up from 3 million as of the end of October 2019. And Work Groups, a Facebook feature that makes it easier for co-workers to stay in touch, now has 20 million monthly active users.
“Workplace Rooms is a secure and easy way for coworkers to get things done and stay connected when they can’t be together in person. It’s a meeting space with unlimited time, where you can invite up to 50 people to a video call even if they’re not in your company or don’t have a Workplace account. Whether you’re holding team meetings, hosting a virtual happy hour, or just jumping on quick one-on-one calls, you can easily create video call links from Workplace Chat, Groups, News Feed or Portal, then share them in a chat, post, email or text message. Screen sharing makes it easy to collaborate with your team in real-time,” said Facebook in a blog post.
This service competes directly against Microsoft’s Skype, Zoom, and Alphabet’s Google Meet.
Earlier this month, Facebook also unveiled Shops — which is a shopping platform that connects e-commerce businesses to customers through Facebook, Instagram, Messenger, and WhatsApp. There are 140 million small businesses that use Facebook products and 1 in 3 businesses in the U.S. do not have a website. So many of them use a Facebook or Instagram account for connecting with customers online.
Facebook Shops is a mobile-first shopping experience for businesses to set up online stores on Facebook and Instagram free. Through those apps, small businesses will be able to display their merchandise and customize online stores with a variety of fonts and colors and utilize tools for chatting with shoppers. And Facebook partnered with Shopify and other e-commerce companies like BigCommerce, WooCommerce, and ChannelAdvisor.
Should You Buy Facebook, Inc. (NASDAQ: FB) Now?
Based on the reports I have been reading, 84% of analysts are saying buy, 12% of analysts are saying hold, and 4% are saying sell. In another report, I am seeing that 4 analysts are saying strong buy, 6 are saying buy, 8 are neutral, 1 says sell, and 0 say strong sell.
Case From The Bulls:
The bulls are saying that with more users and usage time than any other social network, Facebook provides the largest audience and the most valuable data for social network online advertising. And Facebook’s ad revenue per user has been growing, which demonstrates the value that advertisers see in working with the company. Plus the application of artificial intelligence to Facebook’s offerings — along with the launch of virtual reality products — will increase user engagement and drive growth in advertising revenues.
Case From The Bears:
And the bears are saying that Facebook is “a one-trick pony” and will be affected if online ads no longer grow or if more ad dollars are shifted to its rivals. Even though Facebook is seeing rapid user growth, many Facebook’s customers may also belong to other social networks like Snapchat or TikTok so Facebook will have to keep fighting to capture user attention and engagement. There also might be regulations that emerge, which could limit the collection of user and usage data.
Disclosure: I own a small number of Facebook, Inc. (NASDAQ: FB) shares. I wrote this article myself and I do not have any business relationship with any company whose stock I write about. I am not a financial advisor and all articles are my opinion. You should do your own due diligence and consider talking to a financial professional before investing.