Facebook (FB) stock has managed to hit a new ATH despite the challenges related to the ad boycott from major advertisers in the framework of the “Stop Hate for Profit” campaign.
On Tuesday, July 7, 2020, Facebook Inc (NASDAQ: FB) stock rose to reach a new all-time record despite the recent ad boycott from over 900 major advertisers. The shares traded as high as $245 and even $247 per share during the day, only to close the market at $240.86, which reciprocated to a 0.24% rise. In the pre-market, the shares are hovering around the same level at which they closed yesterday with the possibility of continuing with the breakout.
The social media giant seems to be facing challenges every time the U.S, nears the presidential election and campaigns, which significantly alter its cause and in turn revenue collection. This is mainly because the company largely depends on the advertising sector to generate its revenue and in turn keep its operation running smoothly.
However, despite the boycott, the tech company has a huge market cap that is almost clinching on a $1 trillion level, since at the time of reporting it was standing at $685.12 billion. The reserve cash enables it to cushion its businesses despite the short term shortcomings, which are anticipated to be solved as soon as the election and the riots in the U.S. cool down.
Checking the FB shares performance in the past one year, they have added 18.81% in the past twelve months, 17.35% YTD, 38.20% in the past three months, 1.74% in the last month, and 1.39% in the past five days. And it is possible that Facebook stock will set another record soon. It is not a mean achievement as there other multinational companies that are in red since the onset of the COVID-19 pandemic.
Facebook May Have Tougher Times in Next Months despite Recent Stock Record
As the United States was faced with nationwide riots from protestors who were against the killing of George Floyd, Facebook met itself in between the battles and now it’s dealing with consequences of its choices.
More than 900 major advertisers have signed a campaign dubbed “Stop Hate for Profit” which was organized by civil rights groups. The campaign was initiated to pressure the company to block hate speech and also misinforming posts from its site, after the death of a black man in the custody of a white police officer.
However, there seems to be a misunderstanding between the two even after organizing for virtual meetings to discuss the solution. “They (Facebook) showed up to the meeting expecting an A for attendance,” said Rashad Robinson, president of Color of Change.
Facebook responded by saying:
“We know we will be judged by our actions, not by our words and are grateful to these groups and many others for their continued engagement.”
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