Meta Platforms (META) AI Stock Analysis

• Market Cap: $1.79T
• Dividend Yield: 0.3%
• Average Volume (3M): 11.34M
• Price to Earnings (P/E): 27.7
• Beta (1Y): 1.35
• Revenue Growth: 19.37%
• EPS Growth: 47.56%
• Country: US
• Employees: 76,834
• Sector: Communication Services
• Sector Strength: 85
• Industry: Internet Content & Information
• EPS (TTM): 6.43
• Shares Outstanding: 2,171,148,200
• 10 Day Avg. Volume: 8,784,916
• 30 Day Avg. Volume: 11,336,198
• PEG Ratio: 3.78
• Price to Book (P/B): 9.58
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 33.71
• Enterprise Value/Market Cap: 1.00
• Enterprise Value/Revenue: 2.78
• Enterprise Value/Gross Profit: 12.81
• Enterprise Value/Ebitda: 5.39
• 1Y Price Target: $743.69
• Price Target Upside: 6.03% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 45

• Rating: 82 Outperform
• Price Target: $798.00 ▲(13.77%Upside)

Meta Platforms achieves a strong stock score, driven primarily by its robust financial performance and positive earnings call outcomes. While technical indicators suggest positive momentum, overbought signals warrant caution. Valuation metrics indicate a potential overvaluation, and regulatory risks add uncertainty. However, strategic investments in AI and user engagement underpin long-term growth potential.

Positive Factors

Advertising and Monetization

Meta is launching ads on WhatsApp, expected to enhance monetization efforts due to the platform's large and growing user base.

AI and Workforce Expansion

Meta is recognized for AI innovation, attracting top AI talent and potentially boosting its workforce and expertise.

Partnership and Innovation

Meta's $3.5bn investment to acquire a stake in EssilorLuxottica signals a deeper, long-term partnership to develop smart glasses, which could be the next frontier in consumer hardware.

Negative Factors

Financial Performance

Meta's future capital expenditures and operating expenses from large-scale investments could impact its financial performance.

Investment Concerns

Meta's massive Reality Labs investment remains a debate point, with the possibility that the Street might assign negative value to these investments.

Regulatory Risks

Regulators could pressure EU revenues, and tax law changes might impact depreciation for Meta.

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 Platforms makes money primarily through advertising revenue, which accounts for the majority of its income. The company offers targeted advertising solutions across its platforms, leveraging user data to help advertisers reach specific audiences with high precision. Besides advertising, Meta also generates revenue from its virtual reality hardware and software offerings, particularly through Oculus. Furthermore, the company earns from other business services, such as its Marketplace and payment transaction fees, albeit to a lesser extent. Strategic partnerships, such as those with advertisers and content creators, significantly enhance its revenue-generating capabilities.

Meta Platforms Financial Statement Overview

Summary

Meta Platforms displays strong financial performance with robust profitability across its income statement, balance sheet, and cash flow. The company benefits from high margins, solid revenue growth, and efficient cash generation, though minor fluctuations in free cash flow growth and rising debt levels require monitoring. The overall financial health supports strategic growth objectives.

Income Statement

Meta Platforms shows a strong income statement with impressive gross and net profit margins, reflecting efficient cost management. The TTM gross profit margin is approximately 81.7%, and the net profit margin is 39.1%. Revenue growth is robust, with a 5.8% increase from 2024 to the TTM period, indicating a healthy upward trajectory. EBIT and EBITDA margins also remain strong at 42.9% and 47.9%, respectively, underscoring operational efficiency. Overall, the income statement reflects a well-managed and profitable company.

Balance Sheet

Meta Platforms maintains a solid balance sheet with a debt-to-equity ratio of 0.27, indicating manageable leverage. The equity ratio stands at 66.0%, showcasing a strong financial position with substantial equity backing. Return on equity (ROE) is high at 36.0%, demonstrating effective use of shareholders' equity to generate profits. However, the slight increase in total debt warrants monitoring. The balance sheet reflects financial stability and prudent management of resources.

Cash Flow

The cash flow statement is strong, with a significant free cash flow of $52.3 billion in the TTM period. The free cash flow to net income ratio is 0.79, indicating efficient conversion of income into cash. Operating cash flow to net income ratio is 1.44, highlighting robust cash generation capabilities. Free cash flow growth of -3.3% from 2024 to the TTM period suggests minor fluctuations, but overall cash flow remains strong and supports operational and strategic initiatives.

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

Meta Platforms Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 701.41
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Neutral
• STOCH: Positive

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For META, the sentiment is Neutral. The current price of 701.41 is below the 20-day moving average (MA) of 714.97, above the 50-day MA of 678.56, and above the 200-day MA of 620.80, indicating a neutral trend. The MACD of 9.41 indicates Positive momentum. The RSI at 49.29 is Neutral, neither overbought nor oversold. The STOCH value of 7.55 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for META.

Meta Platforms Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GOOGL	83 Outperform	$2.21T	20.30	34.79%	0.46%	13.02%	37.73%
META	82 Outperform	$1.79T	27.71	39.83%	0.30%	19.37%	47.56%
GOOG	81 Outperform	$2.21T	20.42	34.79%	0.46%	13.02%	37.73%
PINS	80 Outperform	$24.72B	13.10	48.41%	―	17.81%	1175.52%
SPOT	76 Outperform	$141.66B	116.49	24.28%	―	16.07%	―
SNAP	66 Neutral	$16.14B	―	-23.97%	―	14.91%	59.90%
Sector *	62 Neutral	$40.93B	-1.67	-12.06%	3.96%	2.10%	-69.66%

Meta Platforms Corporate Events

Meta Platforms Concludes Annual Shareholder Meeting Decisions

On May 28, 2025, Meta Platforms held its annual shareholder meeting where shareholders voted on fourteen proposals. Key decisions included the election of fifteen directors, the ratification of Ernst & Young LLP as the independent auditor for 2025, and the approval of the 2025 Equity Incentive Plan. Shareholders also approved a non-binding advisory vote on executive compensation to be held every three years. However, several shareholder proposals, including those on dual-class capital structure, AI data usage oversight, and GHG emissions reduction, were not approved. These decisions reflect Meta’s strategic focus and governance priorities, impacting its operational and industry positioning.

The most recent analyst rating on (META) stock is a Buy with a $710.00 price target. To see the full list of analyst forecasts on Meta Platforms stock, see the META Stock Forecast page.