Meta Platforms (META) Registers a Bigger Fall Than the Market: Important Facts to Note

Meta Platforms (META) ended the recent trading session at $467.05, demonstrating a -1.54% swing from the preceding day's closing price. The stock fell short of the S&P 500, which registered a loss of 0.6% for the day. On the other hand, the Dow registered a loss of 0.86%, and the technology-centric Nasdaq decreased by 1.08%.

The social media company's shares have seen an increase of 8.01% over the last month, surpassing the Computer and Technology sector's gain of 7.76% and the S&P 500's gain of 3.15%.

Investors will be eagerly watching for the performance of Meta Platforms in its upcoming earnings disclosure. The company's earnings per share (EPS) are projected to be $4.67, reflecting a 44.58% increase from the same quarter last year. Alongside, our most recent consensus estimate is anticipating revenue of $38.15 billion, indicating a 19.22% upward movement from the same quarter last year.

For the full year, the Zacks Consensus Estimates are projecting earnings of $20.19 per share and revenue of $158.97 billion, which would represent changes of +35.78% and +17.84%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for Meta Platforms. These revisions help to show the ever-changing nature of near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.

The Zacks Rank system, stretching from #1 (Strong Buy) to #5 (Strong Sell), has a noteworthy track record of outperforming, validated by third-party audits, with stocks rated #1 producing an average annual return of +25% since the year 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 0.4% higher. Meta Platforms is holding a Zacks Rank of #3 (Hold) right now.

In the context of valuation, Meta Platforms is at present trading with a Forward P/E ratio of 23.49. Its industry sports an average Forward P/E of 29.28, so one might conclude that Meta Platforms is trading at a discount comparatively.

One should further note that META currently holds a PEG ratio of 1.23. The PEG ratio is akin to the commonly utilized P/E ratio, but this measure also incorporates the company's anticipated earnings growth rate. META's industry had an average PEG ratio of 1.7 as of yesterday's close.

The Internet - Software industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 61, putting it in the top 25% of all 250+ industries.

The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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