In this video from Monday's Investor Beat, host Chris Hill and Motley Fool tech and telecom bureau chief Evan Niu look at the biggest trends in the tech sector as 2013 comes to a close.
While tech hardware companies such as Apple and Samsung are trading at very modest price-to-sales multiples, P/S ratios for service companies in the tech sector such as Facebook, Yelp, or Pandora are sky-high. Evan sees this as one of the many signs that both investor and consumer sentiment is undergoing a major shift. Evan delves into what could be causing this shift, highlighting the most popular hardware devices of the day, and why investor excitement in these devices could be waning.
Then, Evan takes a look back at Mark Zuckerberg, and Facebook in 2013. One of the stories that dominated the investing thesis in Facebook after its IPO in 2012 for many investors was the questions circulating around whether the company could capitalize on mobile ad revenue. In October 2012, Mark Zuckerberg stated adamantly that the company could indeed make money on mobile despite the naysayers, and its earnings that quarter showed that mobile ad revenue accounted for 14% of the company's total advertising revenue. Now, mobile ad revenue accounts for 49% of Facebook's ad revenue, up from $150 million to nearly $900 million, an increase of nearly 600% in a year's time. Evan tells investors why Zuckerberg's delivering on his promise of mobile this year makes him tech's CEO of the year, and why Facebook on mobile devices now represents a dream opportunity for advertisers.
And finally, after lagging the market dramatically in 2013, staying largely flat despite the S&P 500's dramatic run-up this year, Apple may have a lot to watch for in the coming year ahead. In this segment, Evan tells investors why new capital distributions to shareholders could be just around the corner with Apple. He also discusses Apple's highly anticipated deal with China Mobile, and new product categories, such as a smartwatch from Apple that so many consumers are eagerly awaiting, that could potentially be on the way for the company in the later part of next year.
Chris Hill has no position in any stocks mentioned. Evan Niu, CFA, owns shares of Apple. The Motley Fool recommends Apple, Facebook, Pandora Media, Twitter, and Yelp and owns shares of Apple and Facebook. Try any of our Foolish newsletter services free for 30 days. We Fools don't 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.