fbpx

Capital 19 Global Financial Trading

05 Oct Time to Buy Facebook

Posted at 14:03h in Investing in US Stocks, Stock Report by
21 Likes

Facebook (FB) made a game changing announcement last week and the recent market weakness is presenting a wonderful opportunity to acquire more shares.

The social media giant announced that users across Facebook, Messenger and Instagram will be able to connect with users on the other platforms, even if they don’t have the other app. Basically users across platforms will be able to connect regardless of which platform they use.

Facebook has done this by creating an integrated back end and it is a masterstroke, for their endgame is to make the Facebook platform the operating system for most of our connected devices.

Bear with me while I explain.

According to Hootsuite, the top five most downloaded apps in January were – Messenger, Facebook, WhatsApp, TikTok and Instagram. With the exception of TikTok, Facebook owns all the other apps in that list.

WhatsApp has 1.5billion monthly active users, Messenger has 1.3billion and Instagram has 1billion. That’s a lot of active users that are now effectively in the one environment.

This mergers of apps began last year, but it is the next stage that will bring the revenue. In June Facebook began testing digital payments in Brazil with WhatsApp. Reuters reported that the company was working with Cielo, Brazil’s largest credit and debit card processor. The free-to-use system will use Facebook Pay, a digital wallet that works across all platform apps.

And Facebook Shops, introduced in May, will help members across Facebook and Instagram create end-to-end ecommerce stores. It’s not hard to imagine how a small business owner might share photos of a new line of dresses on Instagram, then connect it to her Facebook Groups and Shops storefront. Add Facebook Pay and the loop is complete, all within the larger platform and with Facebook clipping the ticket at every stage, even including payment.

You will be able to share content, advertise, sell and collect payment in one place.

It is a direct threat to other leading technology platforms like Amazon(AMZN), Shopify(SHOP), Walmart(WMT) and even Apple(AAPL). By leveraging its 2.3billion active monthly users, Facebook is able to instantly enter the marketplace and add yet more revenue streams to its business.

This is the start of something big and the recent market weakness offers a wonderful opportunity for investors to get in before the news hits mainstream media.

Disclaimer: Capital 19 Pty Ltd ABN 17 124 264 366 AFSL 441891 (‘Capital 19’) believes the information contained is reliable, however, no warranty is given as to its accuracy and persons relying on this information do so at their own risk. This communication is for general information only and was prepared for multiple distributions and does not take account of the specific investment objectives of individual recipients and it may not be appropriate in all circumstances. Persons relying on this information should do so considering their specific investment objectives and financial situations. Any person considering action based on this communication must seek individual advice relevant to their circumstances and investment objectives. Subject to any liability which cannot be excluded under the relevant laws. Any opinions or forecasts reflect the judgment and assumptions of Capital 19 and its representatives based on information at the date of publication and may later change without notice. Any projections contained in this presentation are estimates only and may not be realised in the future. The investment manager certifies that all the views expressed in this document accurately reflect their views about the companies and securities referred to in this document and that their remuneration is not directly or indirectly related to the views. Capital 19, its directors, representatives, employees or related parties may have an interest in any of the companies and securities in this document and may earn revenue from the sale or purchase of any financial product referred to in this document or any advice. Past performance is not a reliable indicator of future performance. Unauthorised use, copying, distribution, replication, posting, transmitting, publication, display, or reproduction in whole or in part of the information contained in this document is prohibited without obtaining prior written permission from Capital 19.
Tags:
, ,