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Social media has quickly sprawled across the globe, allowing us to connect to anyone anywhere at any time with just a few taps of our fingertips.
Of course, there are positives and negatives surrounding many of these applications, but one thing seems certain – they’re not going anywhere anytime soon.
And as we all vividly remember, Elon Musk made a big move last year with his purchase of Twitter for a steep $44 billion.
Now, Meta Platforms (META - Free Report) , home to the wildly-popular photo and video sharing app Instagram and the WhatsApp messaging platform, is making new waves in social media.
The company unveiled Threads on Wednesday, which is aimed at rivaling Twitter. The app is similar to Twitter by nature, allowing users to comment, post, like, and share posts. It’s also closely connected to Instagram, with META hoping its platforms can eventually ‘blend’ together to become a one-stop hub for communities.
Impressively, Mark Zuckerberg posted on his Threads account last night claiming that the app has gained 10 million signups in just a few hours. Still, Elon Musk took to Twitter last night, tweeting, ‘It is infinitely preferable to be attacked by strangers on Twitter, than indulge in the false happiness of hide-the-pain Instagram.’
So, it appears safe to say that the Tesla CEO won’t be making a Threads account anytime soon, especially considering it was revealed that he deleted his Instagram account back in 2018.
Analysts have become bullish on META’s outlook in 2023, with earnings expectations increasing across the board. And if Threads proves successful, it’s reasonable to assume that further upward revisions could hit the tape.
Image Source: Zacks Investment Research
The Zacks rating system has had it right all year, upgrading Meta Platforms into a Zacks Rank #2 (Buy) in February of this year. As we can see in the chart below, the upgrade coincided with a massive run for shares.
Image Source: Zacks Investment Research
In addition, we can see the unfavorable price action within shares when the stock was a Zacks Rank #4 (Sell) and #5 (Strong Sell) in the later months of 2022. Since its upgrade on February 3rd, META shares have rewarded investors with a sizable 60% gain.
But how do other social media stocks currently stack up, such as SNAP?
Snap
Snap’s (SNAP - Free Report) flagship product, Snapchat, is a mobile camera application that helps people communicate through short videos and images. Last year, the company unveiled Snapchat+, which allowed subscribers access to exclusive and pre-release features.
The service recently turned a year old, and SNAP states that the service has gained over four million subscribers. As a company heavily reliant on digital advertising revenue, the success of its premium offering is undoubtedly positive.
Snap posted mixed quarterly results in its latest release, exceeding the Zacks Consensus EPS estimate but falling short of revenue expectations. Market participants didn’t react positively to the results, with shares taking a hit post-earnings. This is illustrated in the chart below.
Image Source: Zacks Investment Research
Still, shares have since recovered, up 35% on a year-to-date basis. While the company’s platform remains somewhat of a threat, catching up to Meta Platforms’ established user base won't be easy.
Bottom Line
Social media is here to stay, and Zuckerberg’s new toy, Threads, looks to disrupt. If the product proves to be a success, analysts will likely continue raising their earnings expectations.
Undoubtedly exciting, it appears that Twitter and other platforms have finally found a new rival. Social media cage fight, anyone?
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Threads: Is a Social Media Cage Fight Brewing?
Social media has quickly sprawled across the globe, allowing us to connect to anyone anywhere at any time with just a few taps of our fingertips.
Of course, there are positives and negatives surrounding many of these applications, but one thing seems certain – they’re not going anywhere anytime soon.
And as we all vividly remember, Elon Musk made a big move last year with his purchase of Twitter for a steep $44 billion.
Now, Meta Platforms (META - Free Report) , home to the wildly-popular photo and video sharing app Instagram and the WhatsApp messaging platform, is making new waves in social media.
The company unveiled Threads on Wednesday, which is aimed at rivaling Twitter. The app is similar to Twitter by nature, allowing users to comment, post, like, and share posts. It’s also closely connected to Instagram, with META hoping its platforms can eventually ‘blend’ together to become a one-stop hub for communities.
Impressively, Mark Zuckerberg posted on his Threads account last night claiming that the app has gained 10 million signups in just a few hours. Still, Elon Musk took to Twitter last night, tweeting, ‘It is infinitely preferable to be attacked by strangers on Twitter, than indulge in the false happiness of hide-the-pain Instagram.’
So, it appears safe to say that the Tesla CEO won’t be making a Threads account anytime soon, especially considering it was revealed that he deleted his Instagram account back in 2018.
Analysts have become bullish on META’s outlook in 2023, with earnings expectations increasing across the board. And if Threads proves successful, it’s reasonable to assume that further upward revisions could hit the tape.
Image Source: Zacks Investment Research
The Zacks rating system has had it right all year, upgrading Meta Platforms into a Zacks Rank #2 (Buy) in February of this year. As we can see in the chart below, the upgrade coincided with a massive run for shares.
Image Source: Zacks Investment Research
In addition, we can see the unfavorable price action within shares when the stock was a Zacks Rank #4 (Sell) and #5 (Strong Sell) in the later months of 2022. Since its upgrade on February 3rd, META shares have rewarded investors with a sizable 60% gain.
But how do other social media stocks currently stack up, such as SNAP?
Snap
Snap’s (SNAP - Free Report) flagship product, Snapchat, is a mobile camera application that helps people communicate through short videos and images. Last year, the company unveiled Snapchat+, which allowed subscribers access to exclusive and pre-release features.
The service recently turned a year old, and SNAP states that the service has gained over four million subscribers. As a company heavily reliant on digital advertising revenue, the success of its premium offering is undoubtedly positive.
Snap posted mixed quarterly results in its latest release, exceeding the Zacks Consensus EPS estimate but falling short of revenue expectations. Market participants didn’t react positively to the results, with shares taking a hit post-earnings. This is illustrated in the chart below.
Image Source: Zacks Investment Research
Still, shares have since recovered, up 35% on a year-to-date basis. While the company’s platform remains somewhat of a threat, catching up to Meta Platforms’ established user base won't be easy.
Bottom Line
Social media is here to stay, and Zuckerberg’s new toy, Threads, looks to disrupt. If the product proves to be a success, analysts will likely continue raising their earnings expectations.
Undoubtedly exciting, it appears that Twitter and other platforms have finally found a new rival. Social media cage fight, anyone?