In the past two decades, social media has exploded in popularity, with billions of active users around the globe. This rapid growth would be thanks to the convenience it brings its users in staying connected with one another. What’s more, the industry continues to innovate, bringing new features to connect and entertain users in new ways. At the same time, social media stocks continue to garner plenty of attention today. A prime example would be Tesla (NASDAQ: TSLA) CEO Elon Musk’s purchase of Twitter (NYSE: TWTR). The likes of which would be making waves in the stock market today on news of Musk “temporarily,” putting the deal on hold.
Furthermore, another notable social media stock most investors would know is Meta Platforms (NASDAQ: FB). Typically, social media companies earn most of their revenue from advertising. And in Meta’s most recent earnings release, it brought in $27 billion in advertising revenue, up by 6.1% year-over-year. In other news, Meta and AMD (NASDAQ: AMD) announced on Wednesday that they will be partnering to develop a mobile internet infrastructure program. Notably, the program aims to bring base station costs down for cellular network operators. This, in turn, would make broadband more accessible around the world. With that being said, check out these four social media stocks in the stock market this week.
Social Media Stocks To Buy [Or Sell] Now
- Bumble Inc. (NASDAQ: BMBL)
- Match Group Inc. (NASDAQ: MTCH)
- Pinterest Inc. (NYSE: PINS)
- Snap Inc. (NYSE: SNAP)
Kicking off our list today is Bumble, the parent company of online dating applications such as Bumble, Badoo, and Fruitz. The company aims to help users connect and build healthy relationships on their own. The Bumble app is one of the most popular dating apps in the U.S., with a monthly user base of about 42 million. On Wednesday, the company posted its first-quarter 2022 results which exceeded analyst estimates. For starters, the company reported an increase in revenue from $170.7 million to $211.2 million, representing an increase of 23.7% year-over-year.
The bulk of its revenue came from its Bumble app, which grew 38% to $155.4 million. Aside from that, the company reported net earnings of $23.9 million, or $0.13 per share. In the past quarter, Bumble also saw its Total Paying Users increase to 3.0 million from 2.8 million a year ago. Accordingly, its Total Average Revenue per Paying User (ARPPU) increased to $22.76, compared to $19.99 in the prior year. In its press statement, the company forecasts its second-quarter 2022 revenue to be in the range of $218 million to $221 million. Overall, given Bumble’s solid rise in paying users, should you invest in BMBL stock?
Another top name in the social media space right now would be Match Group. For the most part, the company owns and operates the largest global portfolio of online dating services. These would include the likes of Tinder, Match, OkCupid, Hinge, Meetic, Pairs, and other notable names. Match Group also offers its services in more than 40 languages, catering to users all over the world. Last week, the company reported its first-quarter 2022 results.
Diving in, the company’s total revenue grew by 20% year-over-year to $799 million. In its letter to shareholders, Match attributed this increase to strong growth in its Payers and Revenue Per Payer (RPP). Namely, its number of Payers rose by 13% to 16.3 million, up from 14.4 million a year ago. Following that, its RPP increased by 6% year-over-year to $16. In the same letter, the company provided its second quarter 2022 revenue outlook of $800 to $810 million, representing an increase of 13% to 14% year-over-year. What’s more, Match’s Board authorized a buyback of up to 12.5 million shares. Could this be a shrewd move with the stock’s recent weakness? And on that note, do you have MTCH stock on your watchlist?
Pinterest operates primarily as an image-sharing and social media service. Its key platform feature is its ‘pinboards’. The likes of which serve to distinguish Pinterest from its social media competitors. Through these pinboards, users can save, design, share, and discover new ideas and concepts across the internet in picture form. Ultimately, all this comes together to help users conceptualize ideas and projects. With over 400 million monthly active users, I can see why investors might be interested in PINS stock.
Towards the end of last month, the company posted its first-quarter 2022 earnings. Pinterest’s revenues improved to $575 million, up 18% year-over-year and surpassing Wall Street estimates of $573 million. Meanwhile, the company significantly narrowed its net losses to $5.3 million, as compared to $21.6 million in the same period last year. Along with that, adjusted earnings per share were $0.10 instead of the estimated $0.04. Another metric to note would be its global average revenue per user (ARPU), which came in at $1.33, rising 28% from last year. For comparison, analysts were expecting an ARPU of $1.31. Considering Pinterest’s performance this quarter, is PINS stock a buy?
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Last, but not least, is Snap. The company identifies itself as a camera company as well as a social media company. Its flagship product is Snapchat, one of the biggest social media platforms around. Besides Snapchat, the company also develops and supplements Spectacles and Bitmoji. On one hand, Spectacles is an augmented reality (AR) device that works seamlessly with Snapchat, allowing for a more interactive experience. On the other hand, Bitmoji allows users to create their own personalized digital avatars which can be used on Snapchat and other messaging apps.
Last month, Snap announced its first-quarter 2022 financials. For its first quarter, the company’s revenue increased to $1.06 billion, up 38% year-over-year from $769.6 million. More impressively is its daily active users, which hit 332 million in the past quarter. This represents an increase of 52 million, or up 18% compared to the year prior. According to its press statement, Snap estimates revenue for the second quarter of 2022 to grow by 20% to 25% year-over-year. Along with that, CEO Evan Spiegel added, “We remain focused on providing value for our growing community, delivering ROI for our advertising partners, and investing against our enormous opportunity in augmented reality.” All in all, is SNAP stock one to watch?