Investors found themselves a bit unsure heading into the Facebook earnings report. After touching its 20 week moving average on Monday, Facebook (FB) rallied a bit, before dipping into its earnings report. All told, this was actually quite a feat… especially when you consider that many investors are becoming cautious on the market as a whole. In this type of environment, high beta, high P/E stocks often fall out of favor as investors look for “safer” stocks. And this is especially true around earnings time, for if said stocks misses earnings, look out.
Well no worries there. Facebook earnings report crushed expectations, producing strong revenue growth in mobile advertising. Remember, less than a year ago, everyone was talking about how they didn’t have a solid mobile strategy… Well, investors are voicing their opinions today, with the stock up over 14% at the time of this writing. Many other “Social” stocks are riding Facebook’s coattails today, including Twitter (TWTR), +7%, and LinkedIn (LNKD), +4%.
Below is a weekly bar chart of FB since it bottomed. Note how the 20 week ma has held twice since the stock established its uptrend… and then came the Facebook earnings. Trade safe.
No positions in any mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.