Facebook shares jumped 4.2% Wednesday, FB makes up 17.5% of XLC’s underlying portfolio, 10.5% of SOCL and 7.7% of FDN.
Facebook said the company posted slowing user numbers, especially among European users amid stricter privacy restrictions, which has weighed on its teenage user retention. CEO Mark Zuckerberg said that 2019 would be an investment year for Facebook as the social media giant tackles calculated misinformation campaigns and prevent security breaches.
“We recognize that concerns will remain around engagement and shifting social behavior, but we view the 2 billion+ user base as stickier than many believe, and Facebook is both adapting to and shaping user behavior. We continue to model revenue deceleration, but we believe it is manageable, particularly as Facebook continues to improve ad products and drive strong return on investment, and as marketers do not have good alternatives to Facebook’s scale and returns,” J.P. Morgan said in a note, adding that it has an overweight position on Facebook.
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