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Social Networking Stocks For The Next Wave of Takeovers


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Time To Consider Which Social Networking Stocks Are The Next Takeover Targets

Social Networking StocksSocial networking stocks have been one of the strongest stock sectors in recent years for a variety of reasons, one of which is the high-profile takeovers of social networking companies by bigger rivals, which have revealed stunning valuations.  For savvy traders and investors looking to profit from acquisitions in the social networking stock sector, it is useful to look at which social networking stocks may be the next takeover targets.  While some of the better known social networking companies, such as Instagram and Tumblr, have already been taken over by behemoths in the sector, there are still plenty of social networking companies that are ripe for takeovers.

Why Takeovers In The Social Networking Sector Should Continue

The reason why takeovers in the social networking sector should continue for many years is because social networking has ushered in a profound change in the way people communicate.  Social networking is not all about friends reconnecting and sharing pictures, it has literally become the primary way many people interact on the Internet, which has profound implications on where and how billions of advertising dollars are spent.  This has companies scrambling to position themselves in the social networking space to be not only access the quickly growing user base, but to also capture the huge advertising revenues.

Top-tier social networking companies, such as Facebook (NASDAQ:  FB) and LinkedIn (NASDAQ:  LNKD), have plenty of subscribers and plenty of cash.  But, they need to maintain their competitive advantage against rivals, which is driving them to pursue strategic takeovers of smaller social networking companies.  Other companies that are tangentially connected to the social networking space have also completed takeovers of social networking companies to expand their presence in the social networking space.  These include companies such as Yahoo (NASDAQ:  YHOO), which took over Tumblr in surprise move during 2013.
Alibaba Group
The huge Chinese e-commerce company Alibaba Group has recently entered the social networking space with the acquisition of 18 percent of the outstanding shares of the Chinese social networking web portal Weibo (the majority owner being Chinese search engine company Sina Corp).  What makes this interesting is that it is another sign that the big Internet players are not done with their investments and outright takeovers of social networking companies.  Alibaba Group is in the process of transitioning to a public company via Initial Public Offering (IPO), which will provide them additional resources to make social networking investments and acquisitions.  Such moves would almost certainly prod other large Internet companies to increase their exposure to the social networking space via investments and acquisitions, which will cause the shares of publicly traded social networking companies to increase in time both due to the new investments and takeovers and anticipation of them.

List Of Publicly Traded Social Networking Stocks That Are Takeover Targets

Social Networking Stocks TakeoversWhich social networking companies will be the next targets of takeovers by larger rivals?  That is very hard to predict; however, traders and investors can position themselves for future takeovers in the social networking sector by buying shares of social networking companies before additional takeover offers are made.

Getting a list together of the potential takeover targets within the social networking sector is the best way to ensure one has a handle on which companies may be worth buying in anticipation of future acquisition news in the red hot sector.  Keep in mind that not all of the companies mentioned below are located in the United States.  In fact, some of the hottest social networking companies and stocks are located in China, which has the world’s largest population; one that is enthusiastic about using Internet-based social media to communicate.

  • Demand Media, Inc. (NYSE:  DMD) provides social media tools via websites such as eHow.com, livestrong.com, and cracked.com
  • Jive Software, Inc. (NASDAQ:  JIVE) provides social business software platforms to businesses, government agencies, and other enterprises for internal social networking
  • Mediabistro Inc. (NASDAQ: MBIS) is an Internet media company that provides social media support services
  • MeetMe, Inc. (AMEX: MEET) is a social networking site that is designed to facilitate people meeting new people online
  • NetEase, Inc. (NASDAQ:  NTES) provides instant messaging, matchmaking, community forums, micro-blogging, blogging, and photo albums in China
  • Renren Inc. (NYSE: RENN) is one of the largest social networking sites in China; it is comparable to Facebook
  • SINA Corporation (NASDAQ: SINA) is a China based Internet search engine that offers social networking services to Chinese language users via Weibo; it is comparable to Twitter
  • Spark Networks, Inc. (NYSE:  LOV) operates relationships websites and social networking services for local event organizing
  • Taomee Holdings Ltd. (NYSE:  TAOM) is a social networking site geared towards Chinese children
  • Tencent Holdings Ltd. (OTC Pink:  TCEHY) operates one of the most popular websites in China, known as QQ.com, which provides the widely popular QQ instant messaging service
  • United Online, Inc. (NASDAQ:  UNTD) provides social networking services and products via the Classmates, StayFriends, and Trombi websites
  • Yandex N.V. (NASDAQ:  YNDX) operates an Internet search engine in Russia and other countries that includes social networking
  • Yelp, Inc. (NYSE:  YELP) while known primarily for its local business reviews, also operates as a social networking site for people sharing opinions about local businesses
  • Youku Tudou Inc. (NYSE:  YOKU) operates a video sharing website in China that is comparable to YouTube

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