Fortnite Is More Popular Than Ever… Good Time to Buy Activision?

Recently, we wrote an Article on Fortnite’s monumental success through the last few months and the effect that it would have on Activision. Since we wrote the article Activision’s stock has fallen over ten percent, dropping 6 billion in market cap.

Fortnite’s popularity doesn’t seem to be fading. Not only has the game gained more users, but Epic Games(The creators of Fortnite) have also come out with a mobile version of Fortnite. Enabling people without a PS4, Xbox, or a computer to access the game.

From our perspective, Fortnite hasn’t slowed down and is more popular than ever. Kids in our school play it in every moment of spare time they have.

Fortnite is doing a good job of coming out with new guns and features to keep the game progressing.

How much room does Fortnite have to grow? Fortnite is getting just about as much publicity possible right now, being featured all over social media, just about everyone has heard about Fortnite. That being said, they simply don’t have much room to grow. Nothing stays cool and popular forever, while Fortnite is popular now, soon the hype around the game will begin to fade. People will get tired of posting about it and talking about it eliminating the buzz around the game. Additionally,  Activision is expected to release a similar Fortnite gameplay to their popular games such as Call of Duty and Overwatch. As of now, there is no one else offering the same style gameplay as Fortnite other than PUBG, when Activision and other companies begin releasing a similar style game, it will become harder and harder for Fortnite to maintain their current active user base.

As Fortnite popularity fades, Activision will be able to reclaim much of their lost market share. Understanding that Activision’s recent dip is due to Fortnite’s success, it is crucial to figure out when Fortnite begins to lose popularity. Identifying this could give you a good entry price in Activision’s stock

Disclaimer: Do not invest your own money without doing your own research, our content is not meant to convince you to buy or sell a stock, but simply to share ideas and unique viewpoints.

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People are Getting Over the Snapchat Update…

One month ago, Snapchat users were shocked with a new app design. The general response to the update was horrible. People were angry and confused.

The update caused many to post their outraged reactions, creating a spiraling negative effect around Snapchat. Many articles on how people were frustrated with the app came out and contributed to the decrease in share price. The worst impact to the company happened when Kylie Jenner tweeted “Sooo does anyone else not open Snapchat anymore? Or is it just me… ugh this is so sad,”. The day this tweet was published, Snapchat went down big. The tweet took 1 billion dollars off their market cap.

Our View:

We believe the market cap decrease after Kylie Jenner’s Tweet was ridiculous. Although Kylie Jenner has a huge following, her tweet did not stop people from snapchatting.  Also,  after Kyle Jenner made her comment, even she continued to use the app and posts frequently.

The Snapchat update was a huge change and may have scared a few users away. However, we believe the anger towards the update has mostly vanished, and people are used to it. When the update first came out many of our friends were disappointed and turned off by the remodel. As time went on, we saw all of our friends’ disgust for the update slowly fade away. Personally, we have completely adjusted to the new design.

The negative media attention surrounding the Snapchat update didn’t translate to fewer users. Many estimates show that little to no Snapchat users left the platform following the update. The number of daily active users only decreased a fraction of a percent. In conclusion, people don’t like change, but they learn to get used to it. That’s what has and will continue to happen with Snapchat and its remodel.

Market Reacts Strongly to Twitter’s New Feature – Stock Was Up Seven Percent on Day

Twitter’s new feature

On March 14th Twitter stated that they were working on a “camera-first” feature. After delivering the news, Twitter’s stock spiked, rising over seven percent on the day. Although early in development, the new concept is said to resemble some of the Snapchats features while being integrated into Twitters existing platform. It is said to incorporate photo, video, and location. That being said, there is very little known about the new feature and nothing can be confirmed.

What does this new feature mean for Twitter? Why did the Market react so strongly?

To back up their successful earnings report, Twitter will need to report strong earnings in the upcoming quarter in order to increase or maintain their current stock price. To do this, Twitter will have to optimize their advertisement capabilities to maximize their ad revenue. Their new feature plays a huge role in increasing their ad revenue as it is an entirely new part of their platform which means entirely new advertising opportunities. Additionally, video advertising is significantly more expensive than text, therefore, many believe that this “camera-first” feature will have a huge effect on increasing ad revenue. Also, this new feature will allow Twitter to compete with other social media platforms such as Snapchat as they now too will be placing advertisements between photos and videos, similar to Snapchat stories.

What do we think of this new feature?

As it is the beginning steps of developing this feature, it is very difficult to understand the specifics of what it will look like and how people will react to it. We believe that a “camera first” feature in which the user can use their camera to post current/relevant photos or videos will fit seamlessly into Twitter’s current platform. Twitter specializes in current day to day topics in real time, this new feature will enhance the user’s experience by giving them the opportunity to express their ideas and feelings through real-time photo and videos that they take. That being said, there have been instances in which new social media features receive a lot of backlash from their platform users at first (ex. Snapchat update, Instagram stories). Even if Twitter’s new update doesn’t get a positive response at first, we believe that the platform’s users will eventually learn to get used to using it as they did with the other social media features mentioned above. Although in the early stages of development, we feel that a feature of this sort would be huge for Twitter.

Disclaimer: Do not invest your own money without doing your own research, our content is not meant to convince you to buy or sell a stock, but simply to share ideas and unique viewpoints.

What Social Media Networks Teens Use The Most – Facebook, Snapchat, Twitter, or Instagram?

Teenagers are always looking at their phone, circulating between social media networks, but do you know which platform teens use the most?

Did you guess Snapchat, Facebook, Instagram, or Twitter?

You probably did. These 4 social media platforms make up 87 percent of teens top preferred networks. However, Snapchat prevails as most popular with almost half of the teens selecting it as their top social media network.

A survey conducted in 2017 shows that 47 percent of teens prefer Snapchat as their top social media network over any other social media networks. Next was Instagram capturing 24 percent of teens. Facebook came in at 9 percent and Twitter 7 percent. 

Our View: In our eyes, the statistics are spot on. Snapchat is absolutely the most common to the teenager life. Streaks, which are created by sending at least one Snapchat back and forth to your friend per day are what keep users coming back day after day. This is why Snapchat has been able to accumulate over 187 million daily active users. Stories, which are 24-hour posts, are an awesome way to keep up to date with what your friends and favorite celebrities are up to. The snap map, which shows where all of your friends are geographically, is an incredibly cool feature that Snap has created, that allows friends to locate each other.  And last but not least, the discover section, which is a place where users can explore news, sports, and anything meaningful going on in the world.

Instagram is incredibly popular for teens. This is where teens usually post their best photos from their best experiences. When people post on Instagram, it is a big deal, compared to posting on Snapchat and twitter which are basically daily updates, posted more casually. 

Our experiences match up with data as we see teens spending the majority of their time on these two networks.

This leaves Facebook and Twitter. Facebook, by the looks of it, has lost all hope with teenage users. We see very few teens still using Facebook as most teens are on Instagram and Snapchat. Only 3 percent of Facebook’s users are teenagers with the majority of their demographic belonging to older generations. For Facebook to increase their number of teen users they will need to make a serious change. However, it is not as bad as it sounds since many of the teenage users they are losing are going to their very own Instagram.

Although Twitter is only 7 percent of teens favorite social media platform, they are still important to the teenage life. We see Twitter as a site that is typically not used every day but more of an impulse site when you need quick updates on a matter or when you want to see what is trending. Although Twitter isn’t the number one site for teens, they definitely provide a unique platform for the uses stated above.

In conclusion, Snapchat and Instagram are running the show, capturing the majority of teens. Twitter is not as essential and appeals to a smaller amount of users. Facebook has really slowed down and has become less and less popular to the ever-changing teenager. Understanding the teenager’s favorite platforms is important because they not only make up a huge part of society but they also provide insight into the future of social media.

Sources:

https://www.statista.com/statistics/187041/us-user-age-distribution-on-facebook/

https://www.statista.com/statistics/250172/social-network-usage-of-us-teens-and-young-adults/

Disclaimer: Do not invest your own money without doing your own research, our content is not meant to convince you to buy or sell a stock, but simply to share ideas and unique viewpoints.

Where Will Twitter’s Stock Go From Here?

Twitter Stock Review(TWTR):

For years, Twitter has failed quarter after quarter to deliver profitability.  Recently, Twitter had its best quarter ever with a net income of 91 million dollars. Shocking the market, Twitter’s stock price has gone straight up since its successful earnings.  Additionally,  although Twitter’s revenue rose, its monthly active user base showed no growth. Twitter has shown great promise with its successful last quarter, however, there are still many issues surrounding the company. Let’s take a closer look at Twitter and what the future could hold.

Their Challenges:

At the moment, one of Twitter’s Problem is the number of fake or inactive accounts on its platform.  Many analysts downgrade the stock believing that many fake and or inactive users make up a large part of their user base. Also, many analysts believe Twitter is too similar to its behemoth competitor, Facebook. They believe that Twitter doesn’t have enough key differentiating factors and will eventually be crushed by Facebook.

The President’s Affect on Twitter:

If you follow politics, you know that The President Trump’s favorite way to reach the general public is through Twitter. He attracts many to the platform who otherwise would not of been on it. As a result, the President has brought publicity and new users to the platform.

Our View:

Although many see Twitter’s Short-term success as no indication of the future, we disagree.  

Twitter is already working on eliminating the inactive accounts that scared away many investors. Once these accounts have been eliminated, we don’t believe that this problem will have a significant or lasting effect on the platform. Additionally, we don’t believe the justification of this downgrade is fair because most other major social media platforms deal with or have dealt with similar issues.

From our recent experiences on Twitter, we have noticed an increase in ads throughout the platform. The company is clearly working to increase its ad revenue by finding new ways to increase the number of ads on the platform. This is great news as it shows advertisers are finding their advertisement campaigns on Twitter successful. However, if Twitter were to make ads even more frequent, the platform would begin to look spammy and tacky. Therefore, for Twitter to start making even more money(which it needs to – currently valued at 101 p/e) it will need to increase its daily and monthly active user base.

We see Twitter as an essential platform that will be here for the long run. Its platform separates it from other social media platforms such as Facebook and Instagram because it is THE PLACE for live news regarding any subject. If we want to see live updates of a sports game – we go to Twitter; If we want live news about a political topic – we go to Twitter; If we want weather updates – we go to our local weather man’s Twitter. The list goes on and on. We would never go to Facebook or Instagram to find these results, because people posting on Facebook and Instagram are mostly sharing special moments in their life, and not their opinion on a public news matter. That being said, some Facebook users do post about these topics, but generally speaking, Twitter has locked up that category. Therefore, because Twitter has a niche that is essential to social media and a strong demand for ads on their platform, we believe they have the potential to continue their success far into the future. 

Disclaimer: Do not invest your own money without doing your own research, our content is not meant to convince you to buy or sell a stock, but simply to share ideas and unique viewpoints.

 

Adidas Innovative Shoes Could Continue to Push the Stock – Company Puts Pressure on Nike

Adidas, founded in 1949, is currently one of the most popular clothing brands. Going up against huge competitors such as Nike, the largest sports apparel company in the world, has left the company out of the spotlight. However, in the past few years, Adidas has done an incredible job innovating and is now putting up an even more impressive fight. This directly relates to their significant rise in share price over the last few years.

Currently, Adidas has a market cap of 43.3 billion, 2 years prior they had a market cap of 13.7 billion.

2017 full years sales were 24 Billion, 3 years prior they were 17.845 Billion. Adidas has p/e ratio of 26.36.

What’s working for Adidas?

Through the past few years, the popularity of the Adidas shoes has grown exponentially. Adidas has created countless numbers of new innovative shoes that are changing the sneaker game. Shoes such as NMD, Ultra Boost, Futurecraft Yeezy, Human Race etc. are playing a huge role in growing the popularity of Adidas shoes. There is such a large demand for some models of these shoes that they not only sell out immediately but also resell for over retail prices.  The great demand for these specific shoes has a huge impact on the entire company as it boosts their brand and reputation. When the general public sees these specific Adidas products reselling way over their original retail prices, hype around the entire Adidas brand is greatly increased. This leads to more demand for all Adidas products which evidently increased their sales.

 

Our View: The increasing popularity of Adidas shoes has the potential to migrate into all of their other types of clothing. This poses a huge threat to Nike and other competitors. The brand is just as cool if not cooler than any of its competitors which has proven to be extremely important in today’s day and age.

The other day during class I looked down at my Adidas Ultra Boosts, then I looked at the kid’s shoes next to me and saw he also had Adidas on. I kept going around the table looking at people’s shoes, there were 6 Adidas and 1 pair of Nikes. A few years ago, if I were at a table, it would have been most likely the other way around. Something is changing……

What are your thoughts on Adidas? Let us know in the comments below!

Disclaimer: Do not invest your own money without doing your own research, our content is not meant to convince you to buy or sell a stock, but simply to share ideas and unique viewpoints.

Spotify in the Spotlight – Company Gets Ready to go Public

Spotify, founded in 2006, has just filed for their company to go public. Different from most initial public offerings, the Spotify stock will go straight to the NYSE with no team researching what the initial price offering should be. The risk associated with the stock could be very high since it could take wallstreet time to understand what the company should be trading at. As quoted from the filing, “prior to the opening trade, there will not be a price at which underwriters initially sold ordinary shares to the public as there would be in an underwritten initial public offering. This lack of an initial public offering price could impact the range of buy and sell orders collected by the NYSE from various broker-dealers. Consequently, the public price of our ordinary shares may be more volatile than in an underwritten initial public offering and could, upon listing on the NYSE, decline significantly and rapidly.”

How does Spotify stack up against Competition?

Spotify is up against tough competitors offering similar music services: Pandora, Rhapsody,Soundcloud, and not to mention the new and emerging Apple Music. Impressively, Spotify leads the industry in monthly subscribers with 71 million, the next closest is Apple Music with 36 million.  Although Spotify is much farther ahead, it is important to mention that Spotify was founded in 2006, while Apple Music was founded in mid 2015. Spotify has had a 9 year head start and Apple already has half the amount of subscribers they do.not only does Apple offer a quality service, but they also have the branding and marketing to heavily promote there service At this point in time, Apple’s success and growing popularity is one of the companies biggest threats.

How much money does Spotify make?

According to their F1 they have recorded increasing revenues for the past three years. In 2015 revenue was 2.37 billion, in 2016 3.6 billion, and in 2017 4.99 billion. However, the company has lost money the past three years as well. In 2015 the company recorded a operating loss of 290 million, in 2016 a operating loss of 431 million, and in 2017 a operating loss of 465 million.(All numbers recorded are in USD)

Our View: While Spotify is one of the leaders in the industry, we dont believe that there is anything separating them from the competition. From what we can see, the service that they provide doesn’t blow away the competitors. This is a problem for Spotify because it leaves little room to raise prices because there are endless alternatives for the consumer to go to for a cheaper price. This would opens the door for other music streaming services such as Pandora and Apple music to take some of their market share.

Additionally, with the large user base that Spotify currently has, they are still losing large amounts of money. Although Spotify is the most popular streaming service, in order for them to become profitable they will need to decrease expenses by renegotiating the amount of money they pay to creators or increase the cost of their premium membership. However, Increasing the cost of the membership is a slippery slope as it could turn customers away. Additionally, Spotify has very little leverage negotiating with music creators as they rely on their new content- if the company doesn’t have the latest popular song, the consumer will not hesitate to take themselves to a different platform.

Will Spotify be able to cut down their expenses while maintaining their market share to turn a profit?

Let us know your thoughts in the comments below!