It was a complete turnaround. Meta Platforms, Inc. FBWednesday saw the social media giant rebound from its fourth quarter disappointment.
The Meta Analyst KeyBanc Capital Markets Analyst Justin Patterson Meta shares were maintained at Overweight with a $280 price target.
The Meta Thesis Meta’s first-quarter revenue of $27.9 billion trailed the consensus estimate, but the earnings per share exceeded Street estimates due to lower operating expenditure and share repurchases, Patterson said in a note.
The company has lowered its operating profit guidance, and the CEO is positive. Mark Zuckerberg The analyst stated that he had reiterated his commitment for long-term profitability.
Analysts believe this is an indication of the caution the company has in weighing investment levels against the business’s health and macroeconomic conditions.
Reels now account for more than 20% of the time people spend on Instagram and overall video makes up more than 50% of the time spent on Facebook, he said.
“While Reels is a monetization headwind over NT, management remains confident with its ability for this transition.”
Meta’s guidance was also better than feared, Patterson said.
Related Link: Why TikTok Could Turn Out to Be Meta Platform’s “Formidable Foe”
Meta suggested the metaverse’s monetization will meaningfully lag investment, the analyst said, adding that he believes this is due to timelines around devices becoming mainstream and advertisers learning new ad formats.
“Net, We believe FB is executing well even in difficult environments and that EPS could return to a 15-20% annual Growth Profile in 2023E.
FB Price Action According to Meta stock, the premarket trading volume for Thursday was 15.3% higher at $201.71. Benzinga Pro data.
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