After testing bear market territory, social media stocks are bouncing back, with the related exchange traded fund among the best performers over the past week.
The Global X Social Media Index ETF (NasdaqGM: SOCL) was up 1.0% Tuesday and gained 5.8% over the past week. SOCL, though, is still down 10.7% year-to-date after a major sell-off in growth stocks pulled down technology names. [Social Slide: Social Media ETF Flirts With Bear Market]
Technology names, notably social media companies, have been among the top performers in the the market rebound as positive corporate earnings helped support market momentum.
“We came into the [earnings reporting]season with very low expectations, and it has at least been meeting those expectations,” Paul Nolte, portfolio manager at Chicago’s Kingsview Asset Management, said in a Wall Street Journal article.
Facebook shares have been strengthening after Credit Suisse analyst Stephen Ju raised his outlook on the company to outperform from neutral, with a price target of $87 from $65, due to newly introduced products, reports Tiernan Ray for Barron’s.
Ju points to increased growth despite impressive gains in ad revenue.
“Facebook will be able to drive revenue growth without a material lift in ad loads, 2) Street models are too conservative and underestimate the long-term monetization potential of upcoming new products, 3) optionality and upward bias to estimates do not contemplate contributions from multiple other products (Offers, 3P mobile ad network, etc.),” Ju said in a report.