Top Performing Social Media Stocks

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Social media is as volatile as the stock exchange itself. It seems like every day, a new platform arises. And almost as often, platforms disappear or transform. With all the volatility surrounding social media, it's fair to question the value of social media stocks.

But there’s a lot of optimism about the future growth of social media. If you’re looking to bolster your investment portfolio, buying social media stocks could put you more closely in tune with social media opportunities that are worth looking into buying right now.

Quick Look at the Best Performing Social Media Stocks:

Deep Dive

Investing in social media can prove to be a lucrative decision.

1. Meta Platforms Inc. (NASDAQ: META)

Meta is the parent company of Facebook, Instagram and WhatsApp. These sites are three of the top four social media platforms in the world by user base. In July 2023, Meta launched Threads, a new social network designed to lure users from Twitter (renamed “X” in July 2023).

The company’s fundamentals are more than sound. Facebook outlasted all other contenders in the social media wars of the 2000s. Meta shows that there’s still room for growth and expansion.

2. Match Group Inc. (NASDAQ: MTCH)

Headquartered in Dallas, Match Group is a leader in online dating services. Along with its flagship Tinder, the Match Group also has Match.com, OKCupid, Meetic and other services in its portfolio. Match Group went public in 2020, so it's a relative newcomer to the stock exchange.

Forecasters expect the online dating industry to gain by double-digit percentages in the next couple of years.

3. Spotify Technology SA (NYSE: SPOT)

The Swedish music streamer Spotify is similar to Facebook in one important regard — it emerged the victor in a once-crowded field. It’s now the most popular music streamer in the world by far, with over 510 million users. 

Spotify recently announced that it’s raising its subscription fee, confirming earlier rumors. Those whispers resulted in a modest share price bump that may only increase once the price change is executed. Considering this, and how high shares have been in the past, right now could be a good time for investors to look into Spotify

4. Bilibili Inc. (NASDAQ: BILI)

Bilibili is a content-driven online community that serves China, the world’s second-largest country. It’s highly video-centric, like its competitor TikTok, but takes a more inclusive view of its user interactions. Bilibili is also branching out into original content and e-commerce.

Its share price is reasonable at the moment, and industry experts expect Bilibili to nearly double its profits in the next two years. At its current price point, taking a risk on Bilibili could be a wise move.

5. Etsy Inc. (NASDAQ: ETSY)

Technically, Etsy is an e-commerce site. But it’s powered entirely by its users, which duplicates the social media approach. Selling homemade items made by its sellers, Etsy’s unique inventory is impossible to duplicate on larger retail sites like Amazon. That’s why its user base has grown exponentially.

Etsy also maintains low-overhead capital expenses. This move has helped it become one of the few social media or e-commerce sites to generate a profit. After the commercial lull of recent years, Etsy’s potential for future growth could be enormous.

6. IAC/InterActiveCorp (NASDAQ: IAC)

IAC is a holding company for several internet and media businesses. It funds social media companies. It was the majority owner of the Match Group for many years and owned the video host Vimeo until it transitioned to public ownership in 2021. 

Current brands under the IAC umbrella include Angi, Allrecipes.com, Dotdash Meredith and several online publications. Although the media landscape is changing, IAC has established itself as a long-term growth possibility with a keen eye for profitable web properties.

Pros

The social media marketplace offers unique opportunities. A few key advantages of investing in social media include:

Growth Potential

Some new social media platforms, like Threads, can explode overnight. Others take a while to break through to the mass market. But either way, there’s plenty of room for growth for the right companies.

Revenue Stream Opportunities

Social media companies earn a great deal from ad revenue. Placement for these ads corresponds to user engagement and algorithms. Future social media efforts may include new, novel ways to generate revenue.

Global Presence

The top social media companies have a worldwide reach. This presence translates into different markets, ads and untapped markets. 

Despite changes in the industry, the social media phenomenon is far from over. 

Where to Buy

Consider this table comparing some of the platforms for buying social media stocks.

How to Choose

Before you jump into a new social media investment, take a look at some of these actions that can help your decision-making.

Researching the Financial Health of the Social Media Company

Social media is a volatile landscape. Smaller emerging platforms generally have limited cash flow in the early stages. But their fundamentals could be sound enough to invest in long-term.

Assessing the Company’s User Base and Engagement Metrics

Social media audiences can fluctuate unexpectedly. Some platforms aim for general usage; others skew toward younger or older users. Look into user base demographics, click-through rates and time of engagement.

Monitoring the Competitive Landscape

Social media’s business environment has seen unexpected changes over the last year. Particularly with new or young platforms, it’s important to know what competitors they’re up against. 

Frequently Asked Questions

Best Social Media Stocks Methodology

Some of the criteria used to evaluate social media stocks include:

• User base size and engagement
• Recent business history
• Long-term durability
• Future revenue estimates
• Global presence
• Current stock prices

By considering these criteria, you can develop a solid methodology to study social media stock trends.