Wednesday 31 July 2013

US stock tip: This may be one stock for your retirement - Facebook!

Dear Friends,

In my class, I have talked about this stock Facebook. I think this is definitely one powerhouse you should have inside your stock portfolio. I am not recommending you to speculate, but to buy and hold for retirement. 

Recently, I ask my students to buy this company upon the breakout of $35 after it gaps up because of its earnings. Now it is $37 plus. Do not blame me if this stock consolidates. I repeat again that this is for the long haul. For retirement, I mean buy and buy and buy whenever it drops!

In America, I have seen how Google grows to become a giant. I have seen how Baidu grows from $80 IPO to $1500 in 3 years. ($1500 is because it splitted 10 for 1 share).

Today we must not ignore Facebook. It's advertising dollars is growing at a fast pace after it release its earnings for this quarter.

Reported in an article:
"Facebook’s mobile advertising has grown more than four times its desktop advertising income in the most recent quarter. With the smartphone and tablet explosion in popularity, it’s no surprise that mobile advertising has become a focus of Facebook’s advertising strategy.  Tapping into a market where the end user is constantly attached to their mobile device means that there is more of a chance of gaining impressions and click-throughs in a quickly growing space. Facebook is gaining ground because they are going to the main source of where people are consuming content. In addition, easy access to the site through well-supported apps for smartphones and tablets means that they will be checking into the site even more because it is readily available.  Facebook recently introduced hashtags and embedded posts as another way to promote activity through smartphones and tablets in order to help people easily connect with others through their mobile app as easily as texting someone."

FB mobile sponsored ad

We think that facebook has dominated mobile advertising, and with 100 million new users, it is a wonderful chance for enterprises to advertise in facebook, which means more money to be made in the future.

Growth, growth and growth is what is needed for a stock to increase multiple fold, and it looks like Facebook finally found a good business model.

Do remember we are not advocating speculation on this stock. Every time it drops, do buy it up as we think this stock has a chance to be the next Baidu!


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