Last month, our own Ian Wyatt wrote a seven-part series detailing “Five Reasons to Avoid Facebook (Nasdaq: FB) Shares”. One of Ian’s reasons to avoid the stock was because Facebook growth is slowing.

New data out today supports Ian’s claim.

According to data compiled by research firm comScore, Facebook growth slowed dramatically in April. The number of U.S. unique visitors to the website increased just 5% in April – the social network’s lowest year-to-year U.S. user growth rate since comScore began tracking the data in 2008.

A look back at the past two Aprils reveals that user growth was 24% in 2011 and 89% in 2010.

This isn’t a huge surprise. Seventy-one percent of all U.S. Internet users already use Facebook. So there’s not a whole lot of room for growth – at least in the U.S.

There’s still plenty of room for Facebook growth overseas, especially in Africa, Asia, Latin America and South America. But those regions aren’t nearly as lucrative for Facebook.

As Ian wrote last month, Facebook’s quarterly revenue per user looks like this:

  • U.S./Canada: $2.79
  • Europe: $1.36
  • Asia: $0.51
  • Rest of the World: $0.36

Facebook’s penetration in its three most profitable markets – the U.S., Canada and Europe – is already close to maxing out. So the real opportunities lie in the underdeveloped world – where the revenue per user one-third of what it is in Europe and one-seventh of what it is in the U.S.

That will make future Facebook growth a major challenge.

Published by Wyatt Investment Research at