Why We're Buying (More) of Facebook

The following video is part of our "Motley Fool Conversations" series, in which analyst John Reeves and advisor David Meier discuss topics across the investing world.

John and David have decided to buy more shares of Facebook for their real-money 10-Bagger Portfolio. Facebook has the largest social media platform with more than 900 million users, and that number continues to grow. The company has been criticized for not having a mobile model, but that's about to change now with its new Sponsored Stories model for mobile only. John and David would agree that Facebook is not cheap. But it's also hard to ignore the company's incredible avenues for growth. It will be very interesting to see what else it accomplishes over time. That's why they're adding to their small position.

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David Meier has no positions in the stocks mentioned above. John Reeves owns shares of Google. The Motley Fool owns shares of Amazon.com, Facebook, Google, and Microsoft. Motley Fool newsletter services recommend Amazon.com, Google, Microsoft, and Yahoo!. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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  • Report this Comment On September 04, 2012, at 11:31 AM, ScottPletcher wrote:

    I think it's very dangerous to buy before the lockup period in November expires, when 1.3 Billion (!) new insider/investor shares can be sold. The earlier release of ~230 Millions shares tanked the stock. It certainly seems possible that 1.3B will hit the stock hard also.

    Wouldn't it make more sense to wait until after the big unfreeze, and then see what the stock looks like?

  • Report this Comment On September 04, 2012, at 11:46 AM, Stonesand wrote:

    Forget the number of shares that will be coming into the market, buying Facebook at about 60x current earnings makes no sense whatsoever. When Aple sells at 15x earnings, there is no justification to recommend that anyone buy Facebok shares now. This is a stock to short not to be long.

    Dave

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