Meta Platforms Reports Strong Earnings, Surpassing Expectations
Meta Platforms (META) has released quarterly earnings of $8.02 per share, outpacing the Zacks Consensus Estimate of $6.68. This marks an increase from earnings of $5.33 per share reported a year earlier, with all figures adjusted for non-recurring items.
Earnings Surprise and Performance Snapshot
This quarterly result translates to an impressive earnings surprise of 20.06%. Just a quarter ago, analysts anticipated earnings of $5.19 per share, but Meta exceeded this by posting earnings of $6.03, achieving a surprise of 16.18%.
In the past four quarters, Meta has consistently surpassed consensus EPS estimates. Additionally, for the quarter ending December 2024, the company reported revenues of $48.39 billion, which also exceeded the Zacks Consensus Estimate by 3.02%. This is a significant rise from $40.11 billion in revenues from the same quarter last year. Meta has topped revenue estimates in each of the last four quarters as well.
Looking forward, the stock’s price momentum will depend largely on management’s insights during the upcoming earnings call.
Year-to-Date Performance and Investor Outlook
Since the start of the year, Meta Platforms’ shares have grown by approximately 15.2%. In comparison, the S&P 500 has seen a more modest increase of 3.2%.
Many investors are curious about what’s next for Meta’s stock. While there are no straightforward answers, one method to assess future performance is to examine the company’s earnings outlook. This encompasses current earnings projections for the upcoming quarters and any recent changes in those estimates.
Research shows a strong link between short-term stock movements and earnings estimate revisions. Investors can track these changes using tools like the Zacks Rank, which has a history of being reliable in guiding investment decisions.
Before the latest earnings release, the trend of estimate revisions for Meta Platforms appeared mixed. Although this could shift after the earnings report, the current indication results in a Zacks Rank of #3 (Hold), suggesting that the stock is likely to perform in line with the market for the foreseeable future.
The current consensus EPS estimate for the next quarter stands at $5.35, with projected revenues of $41.6 billion. For the current fiscal year, the consensus is $25.44 per share on revenues of approximately $186.88 billion.
Investors should also consider how industry trends might influence stock performance. The Internet – Software sector ranks in the top 16% of over 250 industries within the Zacks Industry Rank, indicating strong potential as higher-ranked industries historically outperform lower-ranked ones by more than two to one.
Industry Comparisons: DigitalOcean’s Upcoming Report
Another player in the same sector, DigitalOcean Holdings, Inc. (DOCN), has yet to release its financial results for the quarter ended December 2024. Analysts expect this company to report earnings of $0.35 per share, reflecting a year-over-year decline of 20.5%. The consensus estimate for its revenues is $200.22 million, which would represent a 10.7% increase from the previous year.
Should You Consider Investing in Meta?
Before deciding to invest in Meta Platforms, Inc. (META), investors may want to explore the top stock recommendations for the near future. Zacks Investment Research provides insights that can guide such decisions. Founded in 1978, Zacks has developed tools and independent research that have proven useful for investors over the years.
The Zacks Rank stock-rating system has outperformed the S&P 500, averaging a gain of +24.08% annually from January 1, 1988, until May 6, 2024.
To access the latest recommendations, investors can download a free report featuring the 7 best stocks for the next 30 days.
Meta Platforms, Inc. (META): Free Stock Analysis Report
DigitalOcean Holdings, Inc. (DOCN): Free Stock Analysis Report
To read this article on Zacks.com click here.
Zacks Investment Research
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
