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Stock Watch: Apple & Facebook

Summer is always a relaxing time for me: a time where you can take a break from constantly socializing and meeting new people to be with family.  But as we get back into the swing of things towards the end of August, everyone will be looking for the hottest new social media.  It can be quite a challenge for companies to keep up with constantly changing social landscape, but the ones that do will be the alpha drivers looking forward.  With that in mind, let’s get to the stocks for today.

Apple (APPL):

If I had to put my money on it, I bet you’re reading this on some sort of Apple product.  Unfortunately for the once-great innovator, its stock is down 25% over the last year for one key reason: lack of innovation.  Apple brought forth the most Apple_iWatch_release_date_and_specstechnologically advanced phone of its time when it introduced the world to the iPhone, but the market is all about what is next.  Since those products, Apple has become slower and less imaginative while its competition has chipped away at market share.  The latest idea they have is the new iWatch, which they hope to release later this year.  While it is something new, the people who would be in the market for a ‘smart watch’ already have a phone that can perform similar functions.  Compare this to a more creative idea such as Google Glass and one can see why APPL is a sell.

Recommendation: SELL

Facebook (FB):

Facebook made headlines in the business world this summer by crushing its earning expectations and increasing its revenue.  Just a week after the news came out, the stock jumped 45% and passed by its opening price.  I know what you are thinking: how can Facebook be a buy on Wall Street while Apple gets killed for not being the hot item?  The difference is that Facebook is driven by the user whose homepage changes as people’s interests change.  The changes come as each individual grows and changes their social circles.  It also incorporates new working parts like #hashtags and Instagram (which Facebook now owns).  Along with that, think about its competition.  Whether it’s Twitter (@donahupi), Snapchat (donahupi), Tumblr, or Tinder, none of them are strong enough to compete on all levels of social media.  Facebook is a union of all the other social media pages on one site that most people still check daily.  As they learn to better grow their revenue stream and with the increasing importance of data gathering for retail companies, look for Facebook to remain tabbed on your computer and easily accessible from your smart phone.

Recommendation: BUY


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