Meta Platforms Faces Challenging Market Ahead of Earnings Release

The latest trading session for Meta Platforms (META) concluded with its share price at $510.45, marking a decline of -1.12% from the previous day’s closing value. This dip was less severe than the S&P 500’s decrease of 1.57%. In contrast, the Dow Jones Industrial Average fell by 0.84%, while the tech-heavy Nasdaq dropped by 2.15%.

Before today’s trading, Meta’s stock had decreased by 13.67% over the past month. This rate of decline was less than the Computer and Technology sector’s overall loss of 16.01% and also lagged behind the S&P 500’s 12.16% decrease during the same period.

Upcoming Earnings Report: What to Expect

Market analysts are turning their attention to Meta Platforms as it prepares to release its financial results. The company’s earnings announcement is scheduled for April 30, 2025. Analysts project the company will report an earnings per share (EPS) of $5.33, which represents a 13.16% increase from the same quarter last year. The Zacks Consensus Estimate for revenue stands at $41.29 billion, reflecting a 13.27% rise compared to the previous year’s figures.

For the full year, Zacks Consensus Estimates suggest that Meta will achieve earnings of $25.62 per share and total revenue of $188.04 billion. These projections indicate year-over-year increases of 7.38% and 14.31%, respectively.

Analyst Estimates and Their Impact on Market Sentiment

Recent adjustments to analyst estimates for Meta Platforms highlight the dynamic nature of its short-term business outlook. Positive estimate revisions typically indicate a more optimistic view of future performance, allowing investors to gauge market sentiment more accurately.

Analysis shows that these estimate changes correlate strongly with short-term share price movements. The Zacks Rank system capitalizes on this trend by factoring these revisions into its rating model. This ranking system ranges from #1 (Strong Buy) to #5 (Strong Sell) and has demonstrated a solid track record, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate for Meta has risen by 0.05%, leading to its current Zacks Rank of #2 (Buy).

Valuation Metrics Point to Opportunity

Currently, Meta Platforms trades at a Forward Price-to-Earnings (P/E) ratio of 20.15, which is below its industry average Forward P/E of 23.49. Additionally, its PEG ratio stands at 1.1, a metric that takes into account anticipated earnings growth. The industry’s average PEG has reached 1.8 as of the most recent close.

The Internet – Software industry, part of the broader Computer and Technology sector, holds a Zacks Industry Rank of 78. This places it within the top 32% of over 250 industries, suggesting a favorable competitive landscape. The Zacks Industry Rank reflects the average Zacks Rank of stocks within an industry, indicating that higher-rated industries typically outperform lower-rated ones by a factor of 2 to 1.

Stay Informed with Stock-Moving Metrics

Be sure to visit Zacks.com to keep track of these and other stock-moving metrics as the market continues to evolve.

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This article originally published on Zacks Investment Research (zacks.com).

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