Shares of Facebook, Inc. (FB, Financial), the world’s largest social network, were up 16% in the fourth quarter and 34% in 2015. It was a year ago that we argued that the word “mobile” was no longer describing a device, but rather a behavior. Facebook’s early focus on driving and improving consumer engagement on mobile platforms is starting to bear fruit. The company is the obvious beneficiary of a structural shift of advertising dollars from “analog” to digital, and with one billion active monthly mobile users, Facebook has positioned itself as one of the largest beneficiaries of the mobile way of life by presenting global advertisers with, in our view, the most compelling advertising platform. We believe the company is in the middle stages of scaling and building out its monetization structures and stands to benefit from expected improvements in the price of advertising on its platform. We think Facebook is continually expanding the size of its addressable market by acquiring and investing in newer synergistic offerings such as Instagram, WhatsApp, and Oculus VR.
From the Baron Fifth Avenue Growth Fund Fourth Quarter 2015 Letter.
