Facebook (FB) Launches Tools To Prevent Misuse Of Platform

Facebook Inc. (NASDAQ:FB) announced a number of initiatives in its attempts to build a safer community.

In its latest blog post, Facebook revealed that “engagement bait” posts that forcibly seek an individual’s attention by provoking them to like, share or comment will be demoted by the company.

The social media giant also unveiled tools to prevent harassment on the platform as well as on Messenger by preventing friend requests and messages from a separate account of a user who has already been blocked.

Facebook is also coming down heavily on fake accounts by using signals like the IP address of the user.

Facebook also rolled out changes to tackle unwanted conversations on Messenger. Per the company, once the conversation is ignored by the reader, notifications will be disabled and it will subsequently be moved to Filtered Messages Folder. The sender will not be intimated whether the message has been read, thus eliminating any chance of abuse outside the platform.

Facebook also unveiled an advanced version of its face recognition technology to help users identify pictures in which they are not tagged as well as help them detect when others use their images as profile picture.

Facebook’s aim as reported by the company is “to reduce the spread of content that is spammy, sensational, or misleading in order to promote more meaningful and authentic conversations on Facebook.”

We believe these initiatives will significantly drive Facebook’s user base and sustain the share price momentum. Notably, Facebook has gained 50.8% year to date, substantially outperforming the industry’s 24.6% rally.

Developing Social Infrastructure

Facebook is considered to have pioneered the concept of social networking, which is why it enjoys a first mover’s advantage in this market. The company’s user base continues to grow at a significant pace driven by new features and tools that improve engagement.

Facebook’s continuous efforts clearly indicate that the company is on track to accomplish its mission to protect the community.

In February, CEO Mark Zuckerberg announced in his statement, “the most important thing we at Facebook can do is develop the social infrastructure to give people the power to build a global community that works for all of us.”

We note that rising abuse on social media is a serious concern these days. Cyber bullying and trolling are a serious threat to user growth on social networking platforms.

Facebook’s initiatives to declutter News Feed, which is the first thing the user views after logging on the platform, and provide more security to users will help drive user satisfaction in our view.

The company’s emphasis to drive user engagement by making the platform safer to use is expected to be accretive to its growth. The latest developments to make the platform more viable are encouraging.

Zacks Rank & Key Picks

Facebook carries a Zacks Rank #3 (Hold).

Some of the better-ranked stocks in the broader technology sector include IPG Photonics Corporation (NASDAQ:IPGP) , NetApp Inc. (NASDAQ:NTAP) and NVIDIA Corporation (NASDAQ:NVDA) , all sporting a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks Rank #1 stocks here.

Long-term earnings growth rate for IPG Photonics, NetApp and NVIDIA is projected to be 12%, 11.3% and 10.3%, respectively.

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