Why the Facebook Stock Price Is Down Today After CEO News

Facebook stock price

The Facebook stock price was down 0.4% in early morning trading following news that CEO Mark Zuckerberg will be taking an extended paternity leave following the birth of his daughter.

Zuckerberg announced in July that he and his wife Priscilla were expecting a child, potentially placing the CEO's departure around April or May 2016.

Facebook stock price  Facebook Inc. (Nasdaq: FB) offers up to four months of paternity leave to U.S. employees, but Zuckerberg will only be gone for two months. He stated in a Facebook post on Nov. 20 that it was a very personal decision.

Facebook stock is experiencing a slight pullback because of the Mark Zuckerberg news, but this is not a bearish indicator for the Facebook stock price...

In its last earnings report, the social media giant easily beat Wall Street's expectations. Facebook reported earnings per share (EPS) of $0.57 on $4.5 billion in revenue. That beat Wall Street's expectations of $0.52 on $4.37 billion in revenue.

Facebook also increased monthly active users (MAUs) in Q3 2015 by 14% from Q3 2014. Daily active users of 1.01 billion beat expectations of 992 million.

Since FB stock closed at $74.01 on Nov. 24, 2014, the FB stock price has skyrocketed over 31% on the year. The Facebook stock price opened today at $107.19.

Such impressive growth leaves investors wondering if it's too late to invest in Facebook stock...

It's not. In fact, Money Morning Defense & Tech Specialist Michael A. Robinson sees the FB stock price climbing 133% in five years. Here's why...

Why the Facebook Stock Price Will Continue to Rise in 2016

In his special guide for tech investors, "Your Tech Wealth Blueprint," Robinson created several rules for building massive tech wealth.

One of Robinson's rules is to "separate the signal from the noise."

"In this case, the noise was a widely held belief that Facebook had limited upside because it was just a social site for teens and college students fooling around on their laptops," Robinson stated. "Here's the signal: Facebook is nothing short of a mobile juggernaut - the firm is now an advertising and media cash machine."

The biggest reason Facebook has turned into a mobile juggernaut is because of Zuckerberg's visionary abilities.

You see, the 31-year-old billionaire was criticized for his purchase of Instagram in 2012 for $1 billion. In a report on Facebook, Zuckerberg stated that he wanted to build on Instagram's strengths rather than integrate everything into Facebook.

Zuckerberg played this move perfectly, and he's going to make Facebook billions of dollars because of it. For 2015, research company eMarketer projects Instagram will bring in $595 million in revenue. By 2017, the research company believes Instagram can bring in $2.81 billion.
That will account for over 10% of Facebook's global ad revenue.

Instagram's revenue potential is already very impressive, and Zuckerberg has two more operations he hasn't even monetized yet to increase Facebook's bottom line even further...

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In March 2014, Zuckerberg bought virtual reality company Oculus Rift for $2 billion. TechCrunch estimates that the virtual reality market could see as much as $30 billion in revenue by 2020. Although the specific date has yet to be released, Oculus Rift will launch in Q1 2016.

Aside from Oculus Rift, Facebook also has yet to monetize messaging service WhatsApp. Because it cost him $22 billion, some pundits have been critical of the fact that WhatsApp doesn't currently make money. But Zuckerberg believes that ads and monetization work better when an organic interaction between users and businesses is formed.

If investors have learned anything from Zuckerberg so far, they should know that it hasn't paid to second-guess his judgment.

With strong user growth through its various platforms and advertisers willing to pay big bucks to reach potential clients, the Facebook stock price will continue to rise in 2016 and beyond.

That's why Robinson tells Money Morning subscribers they need to double down on Facebook stock now...

Jack Delaney is an associate editor for Money Morning. You can follow him on Twitter and follow Money Morning on Facebook.

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