Several Web companies may have struggled after recently making their initial public offerings, but Jim Cramer on Tuesday said the Facebook IPO is “the real deal” and urged his viewers to buy it.
The Menlo Park, Calif.-based company operates a social network that boasts more than 900 million monthly active users, as well as approximately 500 million mobile users. These users are a part of a “coveted demo” that advertisers are desperately trying to reach, Cramer said. Through Facebook, advertisers are not only able to reach that demo online, but on their mobile devices, too.
“Facebook has insinuated itself into every particle of human existence in an incredibly fast way, but particularly in the existences of people who are trying to figure out their preferences,” Cramer said. “That, alone, makes the IPO worth participating in.”
From Yelp to Groupon and Pandorato Zynga, a series of Internet companies have had financial difficulties after recently going public. Cramer has recommended investors stay away from all of these names, though. Facebook, however, is another story.
“I'm still urging you to buy it,” he said. “There's simply too much profitable growth with too much opportunity for advertisers to reach prospective clients.”
Rumors have been circulating that Facebook management had targeted t he IPO for May, with a road show to prepare for the sale starting May 7 and trading to begin May 14.
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—Reuters contributed to this report
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