Meta Platforms logged a 0.7% change during today's morning session, and is now trading at a price of $722.66 per share.
Meta Platforms returned gains of 23.1% last year, with its stock price reaching a high of $796.25 and a low of $479.8. Over the same period, the stock outperformed the S&P 500 index by 5.3%. More recently, the company's 50-day average price was $752.51. Meta Platforms, Inc. engages in the development of products that enable people to connect and share with friends and family through mobile devices, personal computers, virtual reality and mixed reality headsets, augmented reality, and wearables worldwide. Based in Menlo Park, CA, the Large-Cap Technology company has 75,945 full time employees. Meta Platforms has offered a 0.3% dividend yield over the last 12 months.
Strong Revenue Growth and an Excellent Current Ratio:
| 2019 | 2020 | 2021 | 2022 | 2023 | 2024 | |
|---|---|---|---|---|---|---|
| Revenue (M) | $70,697 | $85,965 | $117,929 | $116,609 | $134,902 | $164,501 |
| Operating Margins | 34% | 38% | 40% | 25% | 35% | 42% |
| Net Margins | 26% | 34% | 33% | 20% | 28% | 38% |
| Net Income (M) | $18,485 | $29,146 | $39,370 | $23,200 | $39,098 | $62,360 |
| Net Interest Expense (M) | $20 | $672 | $461 | $276 | $677 | $683 |
| Depreciation & Amort. (M) | $5,741 | $6,862 | $7,967 | $8,686 | $11,178 | $15,290 |
| Diluted Shares (M) | 2,876 | 2,888 | 2,859 | 2,702 | 2,629 | 2,614 |
| Earnings Per Share | $6.43 | $10.09 | $13.77 | $8.59 | $14.87 | $23.86 |
| EPS Growth | n/a | 56.92% | 36.47% | -37.62% | 73.11% | 60.46% |
| Avg. Price | $181.64 | $234.55 | $321.17 | $219.36 | $353.96 | $717.34 |
| P/E Ratio | 28.03 | 22.95 | 22.96 | 25.42 | 23.3 | 29.15 |
| Free Cash Flow (M) | $21,212 | $23,584 | $38,993 | $19,289 | $44,068 | $54,072 |
| CAPEX (M) | $15,102 | $15,163 | $18,690 | $31,186 | $27,045 | $37,256 |
| Current Ratio | 4.4 | 5.05 | 3.15 | 2.2 | 2.67 | 2.98 |
Meta Platforms benefits from rapidly growing revenues and increasing reinvestment in the business, strong operating margins with a stable trend, and exceptional EPS growth. The company's financial statements show generally positive cash flows and an excellent current ratio of 2.98.
a Very Low P/E Ratio but Priced at a Premium:
Meta Platforms has a trailing twelve month P/E ratio of 28.3, compared to an average of 30.44 for the Technology sector. Based on its EPS guidance of $25.3, the company has a forward P/E ratio of 29.7. According to the 21.6% compound average growth rate of Meta Platforms's historical and projected earnings per share, the company's PEG ratio is 1.31. Taking the weighted average of the company's EPS CAGR and the broader market's 5-year projected EPS growth rate, we obtain a normalized growth rate of 14.2%. On this basis, the company's PEG ratio is 1.99. This suggests that these shares are overvalued. Furthermore, Meta Platforms is likely overvalued compared to the book value of its equity, since its P/B ratio of 9.32 is higher than the sector average of 4.19. The company's shares are currently trading 273.1% below their Graham number. Ultimately, Meta Platforms's strong cash flows, decent earnings multiple, and healthy debt levels factor towards it being fairly valued, its elevated P/B ratio notwithstanding.
Analysts Give Meta Platforms an Average Rating of Buy:
The 62 analysts following Meta Platforms have set target prices ranging from $658.0 to $1086.0 per share, for an average of $867.14 with a buy rating. The company is trading -16.7% away from its average target price, indicating that there is an analyst consensus of some upside potential.
Meta Platforms has a very low short interest because 1.2% of the company's shares are sold short. Institutions own 79.8% of the company's shares, and the insider ownership rate stands at 0.08%, suggesting a small amount of insider investors. The largest shareholder is Vanguard Group Inc, whose 9% stake in the company is worth $139,178,843,772.
