Meta Platforms, Inc. (META)

Has been looking at this for a long time and what put him over the top was the sheer size of having 1.39 billion in monthly average users. Some of their purchases such as Instagram and Messenger are doing incredibly well. Also, the advertising trends are very exciting. Mobile for example, which grew 100% year-over-year, is leading the way from an advertising standpoint with Facebook. However, when you look at the statistics, 25% of the US adult media time is done on Mobile, yet only 11% of advertising dollars are aimed at Mobile. There is a lot of room to catch up, so that will be in favour for Facebook. He sees another Google coming along.

Had owned this shortly after the IPO. A great story and the execution has been very, very strong. However, it is way too expensive at these prices.

(Top Pick Oct 18/14, Up 37.18%) When you have 25% of your users’ time and only 4% of ad revenues you have an asymmetric risk and it is in your favour. There is still a fair amount of upside. Their advertising model works very well. The return on their customers’ investment is very high.

No dividend. They did this recent acquisition, paid for it out of stock. That is a powerful signal that shares are grossly overvalued.

He was skeptical about this when it went public. However, has been very impressed with their success in monetizing, particularly mobile platforms. There is a lot of competition in the social/media space and there are always new things coming up. Next earnings come out on Oct 28, which may surprise on the upside.

His model price is $41, a 46% downside. His issue with this company is that they bought WhatsUp for $19 billion. That will double the assets of the company, which will probably have a big impact on his model price calculation. He is waiting for the completion of this.

Whenever he buys a stock, he always chooses an initial Sell target. That grounds him from the get-go. This company did very much what he expected when they IPO’d a few years ago. In the majority of the cases, a year later, the stock is down in value. This is a leader in its field. He doesn’t follow this company, but does like leaders.

Looking very interesting. 1.35 billion active users and 1.4 million advertisers. They are becoming more than what we saw them as, a social media, and are really getting a lot of traction on the advertising side. Looks like they could be another Google (GOOGL-Q) so there is good opportunity. The downside is that they are trading at $75 and have $1.50 in earnings, so the multiple is extreme. With these situations, you generally see companies growing into their earnings. Watching it carefully.

She is a value investor. This one is a tough one because it trades at a very high multiple. If they miss a little on quarterly results, the stock can be harshly punished. It is hard to judge the downside on this name. It will likely be around in the next couple of years. She would wait for a pull back.

Twitter (TWTR-N) or Facebook (FB-Q)? All of these properties have not really demonstrated how to make sustainable money. His sense is that this one will ultimately be acquired by someone and will have to come up with an engine of sustainable growth. Feels that Twitter has value. It’s a community, but how do you monetize a community? This is not a long-term hold. Here today and gone tomorrow.

Just hit a record high. Wasn’t sure that it was going to be the company that would have the staying power to be the next Google (GOOGL-Q), etc. However, it has 1.3 billion users and 1.4 million advertisers. Mobility is just growing in leaps and bounds. Looks very interesting.

Twitter (TWTR-N) or Facebook (FB-N)? Feels that the social media names have stretched valuations. It’s such a new phenomenon; it is hard to tell where the earnings are going to come and how they are going to monetize things. This one is in the 3^rd inning where Twitter is only in the 1^st inning. This one is getting its earnings going, and valuations look a little bit better. Earnings were strong today on the mobile side, and they are executing well. This would be his choice over the two. Neither of these fit the profile of his portfolios.

Somewhat of a unique business proposition, because this has got innovations that have proven to be able to generate revenues. The issue is that the multiple is so high. As a GARP investor it is difficult for him to rationalize this one. Expects you could see a good 10%-15% reasonable result from here.

It is difficult for a value investor to buy. More established than Instagram. It is difficult to say what the downside is on these.

Not over the moon in terms of being expensive. We need to determine where it is going to go and how they transition into mobile. It is hard to determine if the advertising will work and earnings will be generated.