Given how much money Facebook and Instagram’s owner continues to pour into building its version of the metaverse, Meta Platforms Inc.’s market-beating rally of the past few months fails to convince some skeptics.
Since the stock’s recent low in November, Meta has been the best performer in the S&P 500 Index, with a 54% gain. The firm’s announcement that it will lay off more than 11,000 people, the company’s first large-scale layoffs in its history, contributed to the jump.
Regardless RIFs, Skepticism Persists
There are, however, several signs of doubt. Meta is one of the cheapest stocks in the Nasdaq 100 Index. Despite the stock’s recent price rally, it sells for less than half its typical price-earnings multiple. Analysts predict the stock will only increase by 7.7% over the next 12 months, 64% below its 2021 high.
What Are Some of The Implicit Investor Ultimatums?
Meta may need to give investors more certainty on certain points, such as its plan to compete with social media rivals like Tiktok, for the rally to continue.
Others, however, believe that Facebook CEO Mark Zuckerberg will trim more or quit his Metaverse ambitions and spending altogether. The approaching economic downturn, which is reducing sales at technology firms, might force his hand.
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