Tigress Financial Partners is aware of Meta Platforms Inc.'s META ongoing ad-revenue headwinds as a result of economic uncertainty, as well as a recent change in Apple Inc.'s privacy rules, but the firm sees deep value in the company.
What Happened: Tigress Director of Research Ivan Feinseth said a note to investors Wednesday reiterated a Strong Buy rating on Meta and adjusted its 12-month price target to $260 on a re-rating of valuation.
"Meta recently reported Q3 results that exceeded consensus expectations, and daily and monthly active users continue to grow," Feinseth wrote. "The current macro environment continues to put expected pressure on advertising revenue as META continues to increase investment in its Metaverse platform Reality Labs and ongoing capital investment in its Family of Apps and content."
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Meta Platforms reported 1.98 billion daily active users for Facebook, up 3% year-over-year. Monthly active users were 2.96 billion for Facebook, up 2% year-over-year.
The company saw its daily active people metric for its family of products hit 2.93 billion in September, up 4% year-over-year. Monthly active people for the company's family of products was 3.71 billion in September, up 4% year-over-year.
The company saw ad impressions increase 17% year-over-year and reported the average price per ad was down 18% year-over-year.
"[We] view the recent pullback in price as a major buying opportunity — Meta's most valuable asset is its massive and ever-growing user base, and it will be able to monetize the ongoing expansion of its family of apps and future product introductions." the analyst wrote.
Last Word: The company is guiding for fourth-quarter revenue in a range of $30 billion to $32.5 billion versus a Street estimate of $32.3 billion, according to Benzinga Pro.
Meta Platforms said it is reducing headcount in some areas of the company and growing headcount only in the area of its highest priorities.
It should be mentioned, Meta hit a 52-week low on Wednesday afternoon.
META Price action: Shares of Meta Platform are down 4.89% to $90.54 at publication Wednesday. The stock has a 52-week high of $353.83, and a 52-week low of $90.48.
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