NEW YORK (TheStreet) -- Facebook (FB) has become a major force in our world.
Much like Google (GOOGL) before it, Facebook matured rather quickly into both a cultural phenomenon and a quality corporation.
To ignore this is to ignore reality, something no wise trader or investor would do. It's better to embrace things as they are than to fight reality.
On a fundamental basis, Facebook now has a staggering market cap of more than $226 billion. The company has no debt and more than $12 billion in net cash (nearing $4.50 a share). It trades at a price-to-earnings ratio of 30, based on estimates of 2016 earnings. That is justified by the company's sales growth rate of 35%.
Facebook is a young company and has a very good future ahead of it for both users and its shareholders. Please note that 70% of Facebook's outstanding shares are held by institutional investors.
Technically FB has one-year stochastics and RSI that for the most part mirror the major stock market averages' chart patterns.
Thus, FB, as I read its chart, is noncommittal relative to an up or down in price bias. Yet, as I read things, when push comes to shove, the pattern remains bullish.
And like many stocks now, FB is becoming coiled.