Better Buy: Facebook vs. Twitter

Social media stocks: Love 'em or hate 'em, it's where many eyeballs are going these days. While social media stocks are susceptible to government regulation, thorny privacy and safety issues, and not to mention young upstart challengers, most companies did exceptionally well last year in the pandemic. With the continuing shift to digital advertising, these companies could be in for sustained growth in the years ahead, even when the pandemic subsides.

Social media companies also benefit from powerful network effects, making first-movers hard to displace. So it's not surprising that two "granddads" of social media, Facebook (NASDAQ: FB) and Twitter (NYSE: TWTR), did well last year. Facebook is up 75% and Twitter is up 140% over the past 12 months, compared with 62% for the S&P 500.