Will Facebook Stock Have A Big Day Based on Q3 Report?
If the pre-market trading is any indication, today could be a rare good (dare we say) great day for Facebook’s stock. As of this writing, the stock is up nearly 19% pre-market. Of course we will see what kind of day-trading profit taking will occur to temper the upswing but this kind of a day could be the one that finally pushes Facebook’s languishing stock (off nearly 50% from its IPO number of $38) in the right direction with a little momentum.
So why the change of heart by investors and why is this important to marketers? Well, to marketers it is obvious. Many are likely to be over-invested in Facebook as a marketing tool. I say over-invested because depending too heavily on a third party platform has its pitfalls and drawbacks. Being diverse in your marketing is as smart as being diverse in investments. Too much weight in one direction means the fall is much worse if that platform stumbles out of favor for any number of reasons.
The reason behind the hope? Yesterday’s 3rd quarter results that took a back seat to Apple’s big announcement day made people happy. In a nutshell, advertising is working and mobile is geting traction. Investors like that since there have been doubts about the viability of both areas for the social media giant. TechCrunch reports
Facebook answered the big question of whether it’s transitioning to become a mobile ad company by noting in today’s earnings report that 14% of total ad revenue from Q3 2012 came from mobile — about $150 million.
The older Sponsored Stories and newer non-social app install and Page ads appear to be gaining traction with advertisers. That number will need to grow significantly in future to keep up with the user shift, as mobile monthlies increased 61% year-over-year to 604 million.
There are plenty of deep-dives into the numbers floating around various sites so I won’t bore you with a ‘me-too’ analysis.
What I will say is that watching this stock since its IPO has been interesting. It seems like Facebook has a semi-teflon like ability to ward off disaster in a situation where many other companies would start showing signs of falling apart. Look at Groupon and Zynga. Two recent high-fliers with meteoric rises to the top and relatively ugly falls from grace. With Facebook you don’t get that sense despite the poor stock performance to this point. Maybe they are too big to fail already?
No matter what the reason, the company is showing signs of weathering the early stock price storm over the long haul (probably way too long for those still holding those $38 IPO certificates). I have no crystal ball and really have no desire to try to predict where this all goes. As a marketer myself, my only concern is that the platform works for me and my efforts. Of course, if I take my eye off the ball and Facebook does a MySpace, it’s on me if I haven’t put plan B,C,D,E etc., etc. in place.
Do you have one just in case the social media giant someday turns into a little person?
UPDATE: Stock opened at 9:30 am EST up about 23%