Meta Platforms (META) AI Stock Analysis

• Market Cap: $1.64T
• Dividend Yield: 0.32%
• Average Volume (3M): 18.09M
• Price to Earnings (P/E): 28.7
• Beta (1Y): 1.33
• Revenue Growth: 21.27%
• EPS Growth: 6.16%
• Country: US
• Employees: 76,834
• Sector: Communication Services
• Sector Strength: 97
• Industry: Internet Content & Information
• EPS (TTM): 1.05
• Shares Outstanding: 2,177,889,200
• 10 Day Avg. Volume: 16,221,765
• 30 Day Avg. Volume: 18,094,508
• PEG Ratio: 0.38
• Price to Book (P/B): 8.12
• Price to Sales (P/S): 9.02
• P/FCF Ratio: 27.44
• Enterprise Value/Market Cap: 1.15
• Enterprise Value/Revenue: 9.97
• Enterprise Value/Gross Profit: 12.16
• Enterprise Value/Ebitda: 18.39
• 1Y Price Target: $830.17
• Price Target Upside: 24.94% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 43
• EPS Forecast (FY): 22.9
• Revenue Forecast (FY): $199.47B

• Rating: 76 Outperform
• Price Target: $753.00 ▲(13.33% Upside)

Meta Platforms' strong financial performance and positive earnings call sentiment are the most significant factors driving the score. However, the high valuation and mixed technical indicators suggest caution. The company's strategic focus on AI and engagement growth is promising, but investors should monitor expense management and regulatory developments closely.

Positive Factors

Revenue Growth

Meta's strong revenue growth indicates robust demand and effective monetization strategies, supporting long-term financial health and market leadership.

AI Advancements

AI advancements enhance Meta's ad efficiency and user engagement, positioning the company for sustained competitive advantage and growth.

Strong Balance Sheet

A strong balance sheet with low leverage provides Meta with financial flexibility to invest in growth opportunities and weather economic uncertainties.

Negative Factors

Increased Expenses

Rising expenses, driven by legal and infrastructure costs, could pressure margins and limit profitability if not managed effectively.

Regulatory Challenges

Regulatory challenges in key markets could impact Meta's operations and financial results, posing risks to its business model and growth prospects.

High Tax Rate

An unusually high tax rate negatively impacts net income, reducing available capital for reinvestment and shareholder returns.

Meta Platforms Business Overview & Revenue Model

Company Description

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 headsets, and wearables worldwide. It operates in two segments, Family of Apps and Reality Labs. The Family of Apps segment offers Facebook, which enables people to share, discuss, discover, and connect with interests; Instagram, a community for sharing photos, videos, and private messages, as well as feed, stories, reels, video, live, and shops; Messenger, a messaging application for people to connect with friends, family, communities, and businesses across platforms and devices through text, audio, and video calls; and WhatsApp, a messaging application that is used by people and businesses to communicate and transact privately. The Reality Labs segment provides augmented and virtual reality related products comprising consumer hardware, software, and content that help people feel connected, anytime, and anywhere. The company was formerly known as Facebook, Inc. and changed its name to Meta Platforms, Inc. in October 2021. Meta Platforms, Inc. was incorporated in 2004 and is headquartered in Menlo Park, California.

How the Company Makes Money

Meta generates the majority of its revenue through advertising. Businesses pay to promote their products and services on Meta's platforms, leveraging advanced targeting capabilities based on user data and behavior. This includes display ads, video ads, and sponsored content across its various services. Additionally, Meta earns revenue through its Reality Labs segment, which includes the sale of virtual reality hardware, such as Oculus devices, and software applications. The company has formed significant partnerships with various advertisers and content creators to enhance its monetization strategies. Furthermore, Meta's investments in the metaverse and augmented reality may open new revenue streams in the future as these technologies evolve.

Meta Platforms Financial Statement Overview

Summary

Meta Platforms exhibits strong financial health with high profitability, efficient operations, and a solid balance sheet. The company maintains a low leverage position and generates substantial cash flows, although the recent decline in free cash flow growth warrants monitoring. The positive revenue growth and strong margins position Meta well for future growth in the competitive Internet Content & Information industry.

Income Statement

Meta Platforms demonstrates strong financial performance with robust gross and net profit margins, indicating high profitability. The TTM gross profit margin is 81.99%, and the net profit margin is 30.89%, both reflecting efficient cost management and strong revenue generation. Revenue growth is positive at 5.96% TTM, showcasing a healthy upward trajectory. The EBIT and EBITDA margins are also impressive at 44.67% and 53.99% respectively, highlighting operational efficiency.

Balance Sheet

The balance sheet of Meta Platforms is solid with a low debt-to-equity ratio of 0.15 TTM, indicating conservative leverage. The return on equity is strong at 30.93%, reflecting effective use of shareholders' funds to generate profits. The equity ratio is healthy, suggesting a stable financial structure with a significant portion of assets financed by equity.

Cash Flow

Meta Platforms' cash flow position is strong, with an operating cash flow to net income ratio of 2.91 TTM, indicating robust cash generation relative to net income. However, the free cash flow growth rate shows a decline of 10.56% TTM, which could be a concern if it persists. The free cash flow to net income ratio is 0.42, suggesting a reasonable conversion of net income into free cash flow.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	189.46B	164.50B	134.90B	116.61B	117.93B	85.97B
Gross Profit	155.35B	134.34B	108.94B	91.36B	95.28B	69.27B
EBITDA	102.75B	86.88B	59.05B	37.69B	55.27B	39.53B
Net Income	58.53B	62.36B	39.10B	23.20B	39.37B	29.15B
Balance Sheet
Total Assets	303.84B	276.05B	229.62B	185.73B	165.99B	159.32B
Cash, Cash Equivalents and Short-Term Investments	44.45B	77.81B	65.40B	40.74B	48.00B	61.95B
Total Debt	51.06B	49.06B	37.23B	26.59B	13.87B	10.65B
Total Liabilities	109.78B	93.42B	76.45B	60.01B	41.11B	31.03B
Stockholders Equity	194.07B	182.64B	153.17B	125.71B	124.88B	128.29B
Cash Flow
Free Cash Flow	44.84B	54.07B	43.85B	19.04B	39.12B	23.63B
Operating Cash Flow	107.57B	91.33B	71.11B	50.48B	57.68B	38.75B
Investing Cash Flow	-89.31B	-47.15B	-24.50B	-28.97B	-7.57B	-30.06B
Financing Cash Flow	-50.98B	-40.78B	-19.50B	-22.14B	-50.73B	-10.29B

Meta Platforms Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 664.45
• 50DMA: Positive
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For META, the sentiment is Positive. The current price of 664.45 is above the 20-day moving average (MA) of 642.89, above the 50-day MA of 662.20, and below the 200-day MA of 670.09, indicating a neutral trend. The MACD of 1.64 indicates Negative momentum. The RSI at 55.97 is Neutral, neither overbought nor oversold. The STOCH value of 25.45 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for META.

Meta Platforms Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GOOGL	85 Outperform	$3.59T	29.27	35.45%	0.27%	13.55%	34.26%
PINS	77 Outperform	$17.48B	9.09	51.49%	―	16.79%	819.94%
META	76 Outperform	$1.64T	28.70	32.64%	0.32%	21.27%	6.16%
RDDT	75 Outperform	$43.08B	127.42	15.22%	―	69.71%	―
AMZN	71 Outperform	$2.37T	32.03	24.33%	―	11.48%	50.70%
SNAP	63 Neutral	$12.90B	-25.88	-22.38%	―	11.75%	49.19%
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%

Meta Platforms Corporate Events

Meta Platforms Reaches Settlement in Privacy Case

On July 17, 2025, Meta Platforms reached a settlement in principle to resolve a stockholder derivative action in the Delaware Court of Chancery, with a settlement hearing scheduled for April 7, 2026. This legal action, which has been ongoing since 2018, involves claims related to Meta’s privacy practices and disclosures, with several plaintiffs and defendants, including Meta’s top executives, implicated in the proceedings. The settlement aims to resolve all claims and dismiss the action with prejudice, pending court approval, potentially impacting Meta’s legal and operational landscape.

Meta Platforms Completes $30 Billion Debt Offering

On November 3, 2025, Meta Platforms completed a significant debt offering, issuing $30 billion in senior notes with varying maturities ranging from 2030 to 2065. This strategic financial move, facilitated through an underwriting agreement with major financial institutions, aims to bolster the company’s financial position and support its long-term operational goals.