Facebook has been operating in the red since the beginning of the company just a handful of years ago. Today it was reported that the company is finally beginning to have profitable operations and that according to CEO Mark Zuckerberg, the company is now cash flow positive and has been since the second quarter.

From the Facebook Blog as posted by Zuckerberg:

“We’re also succeeding at building Facebook in a sustainable way. Earlier this year, we said we expected to be cash flow positive sometime in 2010, and I’m pleased to share that we achieved this milestone last quarter. This is important to us because it sets Facebook up to be a strong independent service for the long term.

Over time, Facebook will continue to be as strong as all of the connections you make. We’ll continue building new and better things to make connecting with the people you care about as easy and rewarding as possible. We thank all of you for helping us reach the point where we are connecting 300 million people, and we hope to serve you and many more people in increasingly deep and innovative ways in the months and years ahead.”

In a previous release from Facebook, the company was not expected to be cash flow positive until sometime in 2010, so seeing profits in the second quarter 2009 is a welcomed surprise.

Facebook also boasts more than 300 million users all across the world.

Nobody has said it in so many words, but we are at the end of the recession. In a time when the economy is going to rise and fall as it stabilizes, it is important to know when a stock is about to falter. Everyone knows the basics. Avoid investing in companies that generate sub par earnings, has weak cash flow, or a less than adequate balance sheet. However, there are other nasty characteristics a stock can hold that will drop it into the toilet in inclement economic weather. Keep an eye out for these other symptoms that show an avalanche ahead.

It is not uncommon for a company to lower their earnings guidance. That can happen for a number of normal reasons that happen in the cycle a company goes through: slightly dropped earnings, a weakened economy, etc. Just make sure that the company in question clears the bar they set in that quarter. Why is that? Of course you’re more worried about the value of the stock than the revenue earned from them. Unfortunately, some shareholders, especially those with controlling interest are so worried about the revenue coming in and the performance of the company that value will go down as people sell for lower and lower prices to get out if they do not have faith in the management of the corporation.

It is also not uncommon for insiders at a company to sell off some shares, especially if life changes they are undertaking require quick funds. Other times, you may be looking at an insider that just wants to make some quick income or diversify their holdings. Sometimes if a bunch of executives all dispense of some of their shares at one time, you are looking at a disastrous future. You begin to wonder, “What do they know that I am not aware of?” Be very wary of executives selling at or near their low points. That tells you the executives think their money is better elsewhere, and yours very well may be too.

Another signal that a stock may be in trouble is when a company abruptly discontinues its guidance toward the investment industry. This may signal that the company has no idea or expectation to have an idea of when earnings could come in. This may also have a minor signal in the way of product or service diversification. The company and its stockholders are in trouble if the company cannot keep up with the accelerating market and/or does not come up with new, innovative products or services to keep up or stay ahead of the industry. You do not want to invest in a company that is “betting all their money on one horse.”

Keep an eye on industry trends as well. Sometimes the nature of the industry at that moment can impact that one company and its competitors at the same time. For instance, General Motors, Chrysler and Ford all came down with the same ‘disease’ at the same time, due to the same debts and the same mistakes. That was the time all GM, Chrysler and Ford stockholders bailed at once, and rightly so. Investors with a sharp eye that receive good, up-to-date news and suggestions from a website like this one may be able to limit or prevent losses just by watching these early signs.