FB or TWTR? Trading social amid tech struggles

Twitter
4 trades in a troubled tech sector   

Amid of rough stretch for technology stocks, "Fast Money" traders debated whether it was worth buying social media names on weakness.

Some of last year's most popular players — including Amazon, Netflix and Google-parent Alphabet — have taken a beating so far in 2016. Shares of social media companies LinkedIn and Twitter both took a recent dive after earnings reports.

Twitter's stock fell more than 4 percent Thursday after the company posted a sequential user drop for its fourth quarter. Despite the weakness, its revenue of $701 million beat expectations and rose 48 percent from the previous year.

YouTube Facebook Twitter
Adam Jeffery | CNBC

With its shares down about 70 percent in the last year, Twitter's valuation "makes sense," contended trader David Seaburg. He said the company holds "tremendous brand value" and could get a boost from possible activist investor activity.

Trader Tim Seymour — who owns Twitter shares — also touted the stock, citing the year-over-year revenue growth.

Facebook, another top 2015 performer, has lost only 2.6 percent this year, easily beating broader markets. The Nasdaq composite has shed nearly 15 percent of its value in the same period.

Trader Dan Nathan believes the stock has not sold off nearly enough to justify buying. Facebook is sensitive to broader economic weakness because it relies on ad spending, he said.

"Facebook will go lower if the major indices roll over," he contended.

Seaburg, though, said he sees Facebook's weakness this year as an opportunity.

For its fourth quarter, Facebook saw revenue climb 52 percent year-over-year, to $5.84 billion.

Disclosures:

Tim Seymour

Tim Seymour is long AAPL, BAC, DO, F, FCX, GM, GOOGL, INTC, JCP, NKE, SINA, T, TWTR, VZ, XOM. Tim's firm is long BABA, BIDU, KO, MCD, PEP, SAVE, SBUX, VALE, WMT,YHOO, short HYG, IWM.

Dan Nathan

Dan is long WMT Feb put spread, long PFE buy-write, long TWTR, long XLP put spread, long XOM Feb put spread, long UUP March calls, long GE May 28 puts, short SPY.

David Seaburg

Opinions expressed by David Seaburg are solely his own and do not reflect the views and opinions of Cowen Group, Inc

Guy Adami

Guy Adami is long CELG, EXAS, GDX, INTC, Guy Adami's wife, Linda Snow, works at Merck.