META), the Facebook parent, delivered a smashing fourth-quarter earnings report
on Thursday, announcing a massive share buyback, and declaring a dividend for
the first time, as well as focusing on cutting back costs and shoring up
billions in profits.
rose 20% Friday to close at an all-time high of $474.99 per share. The gain
added $197 billion to its market capitalization, the biggest single-session
market value addition.
execution, faster growth, and increased capital structure efficiency improve
the outlook from here,” Brian Nowak, an analyst at Morgan Stanley, wrote in a
pipeline for both users and advertisers is robust, with more tools set to
launch and scale throughout ‘24,” he added.
reduced headcount by 22% in 2023, unveiled plans for a $50 billion stock
buyback, and announced its first quarterly dividend on Thursday, a sign to
investors that it has money to spare and a reason for them to stick around.
company is making big cost cuts, it continues to spend aggressively on artificial
intelligence advancements, namely in generative AI but also on the background
technologies to help feed its social media products and power its ad targeting.
Why the META Weekly Options Trade was Originally
Since the Nasdaq Composite began trading in
1972, in every year following a market recovery, the tech-heavy index rose
again -- and those second-year gains averaged 19%. The economy is the wildcard
here, though, and it could yet stumble in 2024. But historical patterns suggest
that this could be a good year for investors.
Recent developments in the field of artificial
intelligence (AI) helped fuel the market's rise last year and will likely drive
further gains in 2024. While estimates vary wildly, generative AI is expected
to add between $2.6 trillion and $4.4 trillion to the global economy annually
over the next few years, according to a study by McKinsey Global Institute.
This will result in windfalls for many companies in the field.
One such company is Meta Platforms Inc (NASDAQ: META).
Meta has a long and distinguished history of
using AI to its advantage. From identifying and tagging people in photos to
surfacing relevant content on its social media platforms, Meta has never been
shy about deploying AI systems.
the release of ChatGPT in late 2022, Meta's share price has been on a tear,
jumping a substantial 174% in the last 12 months alone. Investors are
optimistic about the company's decision to pivot away from metaverse
development to focus more on generative AI, which could optimize its
advertising and improve its consumer-facing platforms.
glance, Meta has some clear advantages in its AI efforts. The social media
giant's business model has always involved gathering and monetizing huge
amounts of data. And generative AI opens another avenue for this strategy
through large language models (LLMs), which are algorithms designed to create
content out of trained datasets.
The META Weekly Options Potential Profit
** OPTION TRADE: Buy META FEB 09 2024 420.000 CALLS - price at last close was $4.55 - adjust accordingly.
Obviously the results will vary from trader to trader
depending on entry cost and exit price that was undertaken.
Entered the META Weekly Options (CALL) Trade on Monday, January
22, 2024 for $4.64.
Sold the META
weekly options contracts on Friday, February 02, 2024 for $65.00; a potential profit of 1,301%.
Don’t miss out on further trades – become a
About Meta Platforms.....
Meta Platforms, Inc. is a US-based
multinational technology company and 1 of the Big 5 US tech companies. It is a
member of the FAANG group holding the first position with its original name,
Meta Platforms, Inc life began in 2004 as a
digital “face book” for Harvard students. The company was founded by Mark
Zuckerburg and a group of friends but now only Zuckerburg remains. The company quickly
grew and expanded into other universities and then opened itself to the public
in 2006. As of 2006, anyone over the age of 13 can be a Facebook user which is
the company’s primary source of income. As of 2022, the company claimed more
than 2.9 billion monthly active Facebook users.
Facebook, Inc filed for its IPO on January 1st
2012. The prospectus stated the company was seeking to raise $5 billion but it
got so much more. The day before the IPO execs announced it would sell 25% more
stock than it had previously stated because of the high demand. The company
wound up raising more than $16 billion making it the 3rd largest IPO in history
at the time.
The massive IPO valuation earned Facebook a
spot in the S&P 500 in the first year of its public life. Although its
valuation has deteriorated in the wake of scandal and consumer trends within
social media, early investors were treated to gains in excess of 1000% at the
peak of the stock run. Mark Zuckerburg retained 22% ownership in the company
following the IPO, and 57% of the voting rights. As of 2022, those holdings
were down to about 14% of the company and 54% of the voting rights.
Over the years, Facebook acquired a large
number of apps and other businesses that include but are not limited to
Instagram and WhatsApp. The company changed its name to Meta Platforms DBA Meta
in 2021 to reflect its business and mission better. The new name describes the
metaverse and refers to the seamless social interaction provided by Meta’s
social media application universe.
Today, Meta develops digital applications that
allow people to connect with family, friends, businesses, and merchants through
Internet connections. Applications are available for mobile, PC, VR, and smart
The company’s primary operating segment is the
Family of Apps. The family of Apps includes Facebook and all the other digital
applications. This segment produces virtually all of the revenue which is in
turn 97% advertising oriented. The other operating segment is Reality Labs.
Reality Labs develops and markets a line of virtual and augmented-reality
the META Weekly Options
adding conversational AI experiences across its popular apps, introducing
features ranging from more responsive image editing on Instagram to
conversational chatbots with distinct personalities on WhatsApp. These efforts
probably won't immediately impact Meta's operational performance, but they
could help maintain its platforms' user engagement and generate valuable
operational side, Meta is bouncing back from the challenges it faced in 2022.
Third-quarter (2023) revenue jumped by 23% year over year to $34.15 billion,
while net income jumped 164% to $11.58 billion, helped by aggressive cost
cutting and layoffs. And with a forward P/E of just 22, it isn't too late for
investors to bet on the company's long-term potential.
have a cloud infrastructure service to peddle its AI wares, but it quickly
developed a workaround. After developing its open-source Llama AI model, Meta
made it available on all the major cloud services -- for a price. Furthermore,
Meta offers a suite of free AI-powered tools to help advertisers succeed.
economic conditions will no doubt boost its digital advertising business. And
with the stock trading at just 22 times forward earnings, Meta is inexpensive
relative to its opportunity.
Meta Platforms had its target price increased by JMP
Securities from $380.00 to $410.00 in a report published on Friday. JMP
Securities currently has a market outperform rating on the social networking
According to the issued ratings of 49 analysts in the last
year, the consensus rating for Meta Platforms stock is Moderate Buy based on
the current 2 sell ratings, 4 hold ratings, 41 buy ratings and 2 strong buy
ratings for META. The average twelve-month price prediction for Meta Platforms
is $366.23 with a high price target of $470.00 and a low price target of
Meta Platforms stock traded up $7.32 during trading on Friday, reaching
$383.45. 21,670,806 shares of the company were exchanged, compared to its
average volume of 12,618,938. The company has a market cap of $985.41 billion,
a P/E ratio of 33.84, a PEG ratio of 1.03 and a beta of 1.22. Meta Platforms,
Inc. has a 52-week low of $134.61 and a 52-week high of $384.36. The stock's 50
day moving average price is $345.51 and its 200 day moving average price is
$319.22. The company has a debt-to-equity ratio of 0.13, a quick ratio of 2.57
and a current ratio of 2.57.