Why Facebook stock price will only go up in the next years

Facebook has been a huge success over the years, it has become a cultural icon, with an increase in stock prices up to 175% in 2015, from an initial price offering of $38. Today, the Facebook stock price is over $100 per share. According to Michael A. Robinson, Money Morning Director of Tech Investing, the Facebook stock price will surpass $250 a share within five years, that’s another %150 growth in value.

Facebook and its acquisitions, WhatsApp, Facebook Messenger, and Instagram account for 44% of all active social platform users according to Statista’s data, and it’s bound to grow even more by accessing new markets such as India and China, two rapidly developing countries. By 2013, India had a population of 1.25 billion, with 65% of its population under the age of 35, this means hundreds of millions of potential new users. China, on the other hand, is very similar in demographics and Mark Zuckerberg seems to acknowledge this enormous potential, because in 2014, according to Bloomberg Business, Facebook quietly leased a space in downtown Beijing, and alongside his other office in Hong Kong, he plans to seize these vast opportunities.
Instagram, which Facebook purchased in 2012, is booming with new users, from an initial 30 million to a staggering 400 million by September 2015, that’s 80 million more monthly active users than Twitter Inc. The market research firm eMarketer predicts that Instagram will earn $2.81 billion in global mobile ad revenue annually by 2017.
Facebook’s two messaging services, WhatsApp and Facebook Messenger have yet to be monetized. WhatsApp has grown from 450 million users to 900 million and Facebook Messanger has 700 million users. Business Insider foresees that WhatsApp alone will generate $3 billion in revenue by 2020.

Perhaps Facebook’s biggest and smartest investment consists in purchasing the virtual reality company Oculus VR in 2014. Even if this type of technology is usually associated with video games, its applicabilities are endless as stated by Mark Zuckerberg himself: “Imagine enjoying a courtside seat at a game, studying in a classroom of students and teachers all over the world, or consulting with a doctor face-to-face – just by putting on goggles in your home.” Research firm CCS Insight anticipates that the augmented and virtual reality device market will be worth around $4 billion by 2018.

 

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