After being stressed by weak mobile advertising revenues over
the last four quarters, the social media giant
finally heaved a sigh of relief this earnings season. The company
reported stellar second quarter numbers on mobile advertising
growth. Earnings per share of 13 cents, not only surpassed our
estimate by 4 cents, but also swung back from a year-ago loss of
Revenues climbed 53% year over year to $1.81 billion and
strongly surpassed our estimate of $1.61 billion. Notably, mobile
advertising revenues accounted for 41% of the total revenue, up
from 30% in the first quarter.
Impressed by the mobile advertising business performance,
revised their target prices upward on the stock. This move swept
away the negative sentiments on the social networking company and
left many feeling bullish on the firm's future (read:
Winning ETF Strategies For the Second Half
In fact, FB shares soared nearly 25% on Thursday on an
elevated volume of ten times more than the normal trading day.
This represents the biggest one-day gain in the company's trading
history, and although still 9.6% below the IPO price, there is
finally some hope for FB stock in the future.
Moreover, there are several growth opportunities for the
company in the years ahead, such as new video ad formats and
Instagram monetization. The stock currently has a Zacks Rank #2
(Buy), suggesting that this trend can definitely continue in the
having heavy exposure to the social media giant were struggling
to hold on to gains when Facebook's share price plummeted (read:
3 Hot Sector ETFs Surging to #1 Ranks
Facebook's share had been under pressure prior to this
earnings season and plunged more than 30% since its IPO in May
2012. This concern now seems to be easing with FB's solid second
quarter results and the impressive run in its share prices.
Below, we have highlighted three ETFs that are heavily
invested in this company and look to be big movers this week and
in the next. Investors should closely monitor the movement in
these funds and grab any opportunity from a surge in the FB share
price (see more in the
Global X Social Media Index ETF (
This is a relatively new product in the social media space
that had its debut a year and a half ago and has amassed only
$10.4 million in its asset base. The ETF charges 0.65% in fees
The fund tracks the Solactive Social Media Index, holding 27
securities in the basket. Of those firms, FB takes the fourth
spot, making up roughly 8.54% of assets. Following the
announcement, the fund added 4.9% on Thursday, pushing
year-to-date gains to over 28%.
PowerShares Nasdaq Internet Portfolio (
This fund follows the NASDAQ Internet Index, giving investors
exposure to the broad Internet industry. The fund holds over 80
stocks in its basket with AUM of $85.7 million while charging 60
bps in fees per year (read:
The Top Choice in the Tech ETF World?
Facebook occupies the top position in the basket with 10.06%
of assets. PNQI gained 4.74% on the day and is up 31.14% in the
year-to-date time frame.
Market Vectors Wide Moat ETF (
This ETF tracks the Morningstar Wide Moat Focus Index and
provides equal-weighted exposure to 21 U.S. securities that have
a unique sustainable competitive advantage in their respective
industries. The fund has accumulated $268.5 million in AUM and
charges 49 bps in fees a year.
Here again, Facebook is the top firm with a 5.35% allocation.
However, the equal allocation strategy prevents heavy
concentration and suggests higher diversification benefits. From
a sector perspective, information technology takes the largest
share with 30.4%, closely followed by industrials (20.1%) and
In terms of performance, the ETF rose 1.72% on the day and has
gained more than 17% year-to-date.
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FACEBOOK INC-A (FB): Free Stock Analysis
MKT VEC-WIDE MT (MOAT): ETF Research Reports
PWRSH-ND INTRNT (PNQI): ETF Research Reports
GLBL-X SOCL MDA (SOCL): ETF Research Reports
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