{"id":6160,"date":"2023-07-19T16:28:23","date_gmt":"2023-07-19T10:58:23","guid":{"rendered":"https:\/\/appreciatewealth.com\/blog\/?post_type=the_big_bucks_show__&p=6160"},"modified":"2024-11-20T10:58:31","modified_gmt":"2024-11-20T05:28:31","slug":"why-should-you-invest-in-meta","status":"publish","type":"the_big_bucks_show__","link":"https:\/\/appreciatewealth.com\/blog\/the-big-bucks-show\/why-should-you-invest-in-meta","title":{"rendered":"Why should you invest in Meta?"},"content":{"rendered":"\n

In 1992, author Neal Stephenson published a sci-fi book called Snow Crash, in which he articulated fantasy about electric cars, wireless technology, smartphones, and the metaverse. Yes, the same metaverse that inspired Mark Zuckerberg to rename Facebook to Meta. The metaverse is a virtual 3D landscape that can let people connect or teleport without physically travelling anywhere. For example, you can attend a conference in Paris via your 3D Avatar from the comfort of your home in India. <\/p>\n\n\n\n

Zuckerberg\u2019s optimism about a technology in its infancy is commendable, but does that make Meta a good investment option? Let\u2019s find out. <\/p>\n\n\n\n

How is Meta performing? <\/strong><\/p>\n\n\n\n

Facebook was founded in 2004, and it went public in 2012 at a valuation of $104 billion. Since then, it has experienced several major ups and downs, as is quite common for big stocks. Currently (as of 19 July 2023), its market cap stands at around $800 billion.<\/p>\n\n\n\n

Take a look at Meta\u2019s financials below:<\/p>\n\n\n\n

(Amounts in billions of USD)<\/p>\n\n\n\n

 <\/td>Q1 2023<\/td>Q4 2022<\/td>Q3 2022<\/td>Q2 2022<\/td>Q1 2022<\/td>Q4 2021<\/td><\/tr>
Revenue<\/td>28.6<\/td>32.2<\/td>27.7<\/td>28.8<\/td>27.9<\/td>33.7<\/td><\/tr>
Operating Margin<\/td>23.56%<\/td>24.82%<\/td>29.74%<\/td>33.41%<\/td>36.68%<\/td>39.65%<\/td><\/tr>
Net Margin<\/td>18.27%<\/td>19.90%<\/td>24.41%<\/td>28.16%<\/td>31.20%<\/td>33.38%<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

 <\/p>\n\n\n\n

Where does Meta\u2019s revenue come from?<\/strong><\/p>\n\n\n\n

Meta\u2019s largest source of revenue is advertising on its various social media platforms. Let\u2019s look at its revenue structure below to get a better idea. <\/p>\n\n\n\n

Business Segment<\/strong><\/td>Revenue Contribution in %<\/strong><\/td>Revenue Contribution in USD (2022)<\/strong><\/td>Source of Income<\/strong><\/td><\/tr>
Family of Apps<\/td>> 98%<\/td>114.45 billion<\/td>Advertising on Instagram, Messenger, third-party affiliated websites, and apps. <\/td><\/tr>
Reality Labs<\/td>1.85%<\/td>2.16 billion<\/td>AR and VR products and services.<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

 <\/p>\n\n\n\n

The stock performance of Meta<\/strong><\/p>\n\n\n\n

Meta stock has performed reasonably well over the years, as is evident in the table below.<\/p>\n\n\n\n

Year<\/td>Average Share Price<\/td>Year High<\/td>Year Low <\/td>Yearly Change<\/td><\/tr>
2023<\/td>$216.05<\/td>$313.41<\/td>$124.74<\/td>159.31%<\/td><\/tr>
2022<\/td>$180.18<\/td>$338.54<\/td>$88.91<\/td>-64.22%<\/td><\/tr>
2021<\/td>$321.16<\/td>$382.18<\/td>$245.64<\/td>23.13%<\/td><\/tr>
2020<\/td>$234.55<\/td>$303.91<\/td>$146.01<\/td>33.09%<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

 <\/p>\n\n\n\n

Who has stakes in Meta?<\/strong><\/p>\n\n\n\n

At the time of FB IPO, Mark Zukerberg owned 28% of company stock, but his holdings currently stand at around 13.6%. Some major institutional shareholders in Meta are: <\/p>\n\n\n\n