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Meta Platforms: The Ten-Year Investment Journey Unveiled

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Changes in a stock’s price are a major focus for most investors, impacting portfolios and allowing comparisons across sectors. FOMO, the fear of missing out, also influences investing decisions, especially with tech giants and consumer-facing stocks.

Imagine investing in Meta Platforms (META) a decade ago. It may have been challenging to hold onto META, but what would that investment be worth today?

The Business Behind Meta Platforms

Let’s delve into Meta Platforms’ key business drivers. Meta Platforms is the world’s largest social media platform, expanding from the Facebook app to include Instagram and WhatsApp through acquisitions. These apps, along with Messenger, have a combined monthly user base of nearly 3.96 billion people as of Sep 30, 2023.

A new metric, family daily active people (DAP), shows 3.14 billion daily users across Meta’s suite of products. Key user metrics like daily and monthly active users were 2.085 billion and 3.049 billion, respectively, as of Sep 30, 2023.

Headquartered in Menlo Park, CA, Meta earned $116.61 billion in revenue in 2022, with 97.5% coming from advertisements. Marketers can place ads on Meta, Instagram, Messenger, and other platforms.

Despite competing with Google, Twitter, Amazon, and Snap, Meta has gained a significant market share in advertising thanks to its vast user base. Competitors like Apple, YouTube, Bytedance, and Tencent also pose a challenge in various segments.

Meta’s core app fosters connections, sharing, and discovery through News Feed. Instagram allows users to share photos, videos, and messages, while Messenger and WhatsApp facilitate communication. Meta also offers VR products through Oculus.

The Investment Landscape

A $1000 investment in Meta Platforms in March 2014 would now be valued at $7,159.36, a gain of 615.94% as of March 1, 2024, outperforming the S&P 500’s 174.07% rally and gold’s 48.34% return.

Analysts foresee further upside for Meta due to its steady user growth, particularly in Asia Pacific. Increased engagement with offerings like Instagram, WhatsApp, Messenger, and Facebook, along with AI-driven content recommendations, bodes well for the company’s future.

While challenges like slow Reels monetization and operating losses at Reality Labs persist, positive growth indicators like strong Reels adoption and analyst sentiment indicate promising prospects ahead.

Shares have surged by 24.15% in the past four weeks, with 15 higher earnings estimate revisions in the last two months for fiscal 2024, further reflecting optimism surrounding Meta’s trajectory.

Zacks predicts significant potential for Meta Platforms, highlighting the company’s growth opportunities and favorable market positioning in the evolving digital landscape.

For investors seeking the next potential investment gem, Meta Platforms emerges as a compelling candidate with a track record of robust performance and promising future prospects.

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.