First up is Facebook (FB). VCs love this social networking giant, and for good reason. For funds that entered positions in Facebook early, the IPO process brought in some windfall gains (even if share prices didn't cooperate immediately afterward). But what's notable now is the fact that venture funds are still holding onto many of their shares. The small sampling of VCs who posted their most recent 13Fs are still hanging onto more than $304 million worth of FB stock.
That's good enough to make Facebook VCs' favorite stock right now.
Facebook is, simply put, the most popular Web site on the internet. People spend more time on the site than anywhere else online, and that fact carries a lot of value. Facebook also holds some of the most valuable demographic information on its users, a fact that dramatically increases the firm's ability to sell ultra-targeted ads at premium pricing.
In my view, Facebook's biggest problem is the fact that it still has to distract its userbase from friend-stalking in order to generate ad revenue. The firm has done a good job of fixing that in recent quarters, pushing gaming revenues and integrating marketplace efforts more naturally across the site, it's still an issue.
From a technical standpoint, shares have been looking "toppy" for a little while now. If shares can break out above $60, consider it a strong buy signal.