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Facebook vs Twitter Stock

Facebook vs TwitterWhich social media stock is a better deal: Facebook (FB) or Twitter (TWTR)? This has been a big question lately, especially amongst day traders and binary options traders, and if top experts are right, the answer is a resounding “Facebook.”

It’s really not that hard to figure out. Twitter is priced at $69.00 per share going into the weekend, and Facebook is at $54.56. This is more than a $14 difference per share–and although Twitter has been outperforming Facebook over the last several weeks, this will be changing very soon. Facebook is predicted by some experts to be at almost $60 per share one year from now, while those same experts say that Twitter will be under $45. This is obviously a long term prediction, but the findings will undoubtedly have an impact well before the conclusion of the year.

The fact of the matter is that Twitter had a perfect IPO a few weeks ago, and when Facebook was first publicly offered, the process was pretty sloppy. Now that both companies are settling into their respective positions within the stock market, their true values are shining through, and Facebook is clearly the stronger and more stable company.

But it’s not time to act on this yet. Even options that are open for as long as a week may see themselves running into trouble if they are initiated now. A year is a long time, and it’s pretty clear right now that these stocks both need some time to sort themselves out before they get going in their predicted directions. Twitter has gone up almost $30 per share in the last month, and this is a pretty definite uptrend that it is seeing right now. In reality, Twitter still may have more upward motion before it starts finding its true value. The IPO was very favorable for Twitter, and because it was so recent, a lot of traders are still very excited about this. The same is true, but in an opposite way, for Facebook. The IPO for FB was great, but within a few weeks afterward, the stock came crashing down. This has been at the forefront of trader’s minds, even a year and a half after the fact.

This should alert you to exactly how sensitive stocks (and other assets) are to the emotions of traders. Basic statistics of these companies illustrate some of the big differences that show exactly why trader sentiment is wrong right now. For example, looking at balance sheets shows a huge discrepancy in the amount of cash these companies have. Twitter is doing very well for a brand new publicly traded company with a total cash amount of $321.08 million. Facebook puts this to shame in a huge way, though, with $9.33 billion. Facebook simply has a better established platform right now, and this should propel them well ahead of Twitter in the near future.

If you are interested in trading these social media companies as binary options, these are definitely things you need to know, even if you’re using 60 second options. You definitely want to go with the current trend for these trades, but knowing that the trend can and probably will reverse at any moment is valuable information and will help you to plan your trading out ahead of time and prepare for any unexpected changes that occur. This is something that a lot of short term traders forget; it’s not the number of trades you make per day, it is the number of quality trades you make. And correct info gets you more quality trades and fewer losing ones.
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