I don’t use social media much. Not so with my co-sponsor and research analyst Matt Clark.
But that is inevitable. you please do not There is some form of social media that can be directed to people. That’s why Twitter creator Jack Dorsey bowed when he resigned as CEO last week.
This week Investing with CharlesMatt and I discuss Dorsey’s move and why he wanted to do so, despite the prevalence of social media in today’s culture.
Also in the pit Twitter Inc. (Nasdaq: TWTR). Against Meta Platforms Inc. (Nasdaq: FB). To see which are good social media stocks to buy now.
Here are some highlights from our conversation.
Dorsey leaves Twitter
mat: There is something interesting today. Last week, it was announced that Jack Dorsey, who had been CEO of Twitter for the past 15 years, soon resigned as CEO of Twitter.
Dorsey continues to be the CEO of Square, a very popular fintech company, which raises an interesting question. Twitter and Meta have these two social media giants. (Of course, Meta, which used to be Facebook, is still traded on FB.)
Charles: How many years did it take to start calling the Google Alphabet instead of Google? It takes a lot of time to remember to call Facebook Meta.
mat: Unless I call it the right company, it’s still Google. If not, it’s still Google. Facebook is still Facebook. Meta, if I call it a company, it will take some getting used to.
Charles: To make that distinction, you almost have to rewire your brain.
mat: There is a meta FB, especially if you are maintaining a ticker like Google’s GOOG or GOOGL in either Class A or Class C.
Anyway, there are two companies that have faced significant headwinds in the last few months. Meta fired in a whistleblower investigation The Wall Street Journal … Questions about corporate culture issues, their algorithms, and their business practices. Some dubious things discovered by The Wall Street Journal.. Twitter, on the other hand, doesn’t face these negative headlines.
But when the CEO, who started the company and served as CEO for 15 years, suddenly resigns, a lot of interest arises. And that’s exactly what happened. Twitter inventory has declined exponentially since Dorsey announced that @Jack no longer exists on Twitter.
So he raised the interesting question of comparing these two stocks to see if either one was the right social media stock to buy.
The rise of social media
mat: Both are social media stocks. Technically, they rely on web-based data and services. This is ironic in the market for selling, collecting and selling data. And when it comes to social media, you and I have similar perspectives.
I don’t think either of us uses it much. I’m not necessarily a big fan. Twitter is the platform of my choice. I’m not a Facebook tycoon.
Charles: I don’t have an account on Facebook either. By the way, I deleted it in a long process. It took years to actually remove it successfully.
mat: I’m getting along with people who really don’t know what they’re eating for dinner. But if you look at the numbers here … In 2020, the number of social network users in the United States will be about 223 million, which is a significant proportion of the population. However, if we scale this up after 2021, by 2026, 323.1 million people will be using social media.
Charles: I think it’s essentially everyone over 4 years old.
mat: exactly. Social network penetration in the United States will increase from 67% in 2020 to 94.5% in 2026. Social networking is on the path to replacing regular networking. It will replace face-to-face conversations as much as it already has.
So these big powers like Twitter and Meta have been in the game for some time, but face some serious headwinds. My question to you is: As an investor, if you are really interested in taking advantage of this trend of 94.5% penetration of social networking by 2026, which horse would you like to bring back here?
Charles: Let’s go back a little to Jack Dorsey. Jack Dorsey is the brain behind two celebrities in technology over the last two decades, Twitter and Square. He chose to move away from one and focus on the other. It shows which one he chose.
He chose to continue operating Square. Why? Well, I don’t know. You can’t call him and ask. We are not so tight. But to me, it looks like Dorsey saw his two works here and said: Which one is likely to make more money? Which one seems worth my time? “
Is Fintech a Safer Investment?
Charles: Dorsey Millionaire. He doesn’t have to do anything. He could sit on the beach all day if he wanted, but he decided that Square was worth his time.
I tend to agree.
I don’t use squares. I use some of his competitors like PayPal and Venmo. I use a variety of FinTech products, but Square is very popular. And FinTech is gradually replacing the banking system, or at least learning to coexist with it.
So for me, FinTech is a much bigger story. If I were Dorsey, I would have made the same decision. You really can’t be the CEO of two big companies, and you can’t pay attention to both. If you had to choose, I would have chosen Square too.
Return to TWTR vs. FB
Charles: So what does that mean for Twitter and Meta (Facebook)?
There is no unlimited advertising revenue there. Advertising space is dominated by Facebook and Google. These are the plates that are eating up most of their revenue. Facebook is very good at monetizing users. Facebook is not a product. The user is a product. Facebook sells user data and is good at it.
Twitter hasn’t been very successful in monetizing users. It just doesn’t have the same level of penetration. Twitter doesn’t understand that. It has a lot of data, but doesn’t understand how to properly monetize it to the extent Facebook has.
So this is my conclusion: If Dorsey feels it’s not worth sticking to Twitter, why are you or me good?
Click here for a detailed analysis of this week’s TWTR and FB Investing with Charles..
Where to find us
The mat that will appear this week is Bull & Bear It’s a podcast, so stay tuned.
Don’t forget our check Ask Adam anything A video series where Chief Investment Strategist Adam O’Dell answers your questions.
You can also catch the mat every week The latest information on the marijuana market.. If you’re interested in cannabis investment, you don’t want to miss Matt’s weekly insights.
Remember, you can email me with my team Feedback@MoneyandMarkets.com — Or leave a comment on YouTube. We love to hear from you! May feature your questions and comments in future editions of Investing with Charles..
For safe benefit
Charles Size More
Co-editor, Green Zone Fortune
Charles Size More Is a co-editor of Green Zone Fortune Specializes in income and retirement topics. He is also a frequent guest on CNBC, Bloomberg and Fox Business.
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