ARK Investment CEO Cathie Wood believes Facebook's share growth will continue due to the company's influence.
"It's changing all of our lives. It seems to be getting into everyone's media company's face so we think it's worth 10 times the sales," Wood said on CNBC's "Squawk Box" Tuesday morning.
The key to Facebook's growth to Wood is their user engagement. The company's close attention to detail in measuring engagement and willingness to adjust its strategy means they can continue to grow.
"The growth is going to continue to surprise on the high side of expectations because these are network effects taking place," Wood noted.
Today's tech growth is a case of "the bigger getting better," according to Wood. She thinks each of the four biggest technology companies could reach more than a trillion dollars in market capitalization.
"That sounds crazy and a lot of people who used trillion dollar valuations back in the tech and telecom bubble regretted it. The tech and telecom bubble set us up for what we're experiencing now," Wood added.
Shares of Facebook are down 1.08% to $122.97 in late morning trading today.
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Separately, TheStreet Ratings team rates Facebook as a "buy" with a ratings score of A-.
This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that TheStreet rates. The company's strengths can be seen in multiple areas, such as its robust revenue growth, largely solid financial position with reasonable debt levels by most measures, impressive record of earnings per share growth, compelling growth in net income and expanding profit margins. TheStreet Ratings feels its strengths outweigh the fact that the company is trading at a premium valuation based on TheStreet Ratings review of its current price compared to such things as earnings and book value.
TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this articles's author.
You can view the full analysis from the report here: FB