Don't Buy Meta Platforms Until There Is Fundamental Change

Summary

  • Meta Platforms revenue is declining primarily due to TikTok but also from an easing economy and growing ad sales from AMZN, MSFT and NFLX.
  • The Metaverse built by Meta isn't taking off - despite 10 million headset sales, there are less than 200,000 monthly users of Meta's Horizon.
  • Neither Congress nor Biden nor US government agencies seem to have the constitutional power to ban TikTok.
  • We provide a 200-word summary up front or you can dive into 3,300 words on the 9 main points bulls and bears are debating.

TikTok and Facebook application on screen Apple iPhone XR

5./15 WEST

Is Meta a value buy or value trap?

Meta Platforms (NASDAQ:META) needs no introduction. What does need introducing is that Meta is no longer a growth stock. Meta has fallen more than 70% so far in 2022 as revenues and

Meta Revenue and Growth

Meta Revenue and Growth (Caterer Goodman)

TikTok Rapid Growth

TikTok Rapid Growth (FT Research)

Teen usage of Social Media

Teen usage of Social Media (Pew Research Centre)

FB Monthly and Daily Active

FB Monthly and Daily Active (Statista)

Treasury Yield Inversion

Treasury Yield Inversion (Bloomberg)

Advertising Sales Market Share

Advertising Sales Market Share (Economist)

Amazon Advertising Sales

Amazon Advertising Sales (Geekwire)

Horizon Worlds Monthly Users

Horizon Worlds Monthly Users (Caterer Goodman)

Steam Headset Use

Steam Headset Use (RoadtoVR)

Reality Labs Accumulated Losses

Reality Labs Accumulated Losses (Caterer Goodman)

Mark is Driving

Mark is Driving (Business Insider)

Meta Equity Current Assets Plant

Meta Equity Current Assets Plant (Caterer Goodman)

Meta Net Income Buybacks and Stock Outstanding

Meta Net Income Buyback Stock Outstanding (Caterer Goodman)

Meta Family Daily Active Users

Meta Family Daily Active Users (Meta)

Leading Social Media Platforms

Leading Social Media Platforms (Statista January 2022)

This article was written by

CGP Asset Management manages discretionary trading accounts for clients in a “Global Technology Growth” strategy. This strategy combines quantitative and qualitative elements with a global perspective. The parent company Caterer Goodman Partners was co-founded by Owen Caterer in 2011 as a financial advisory firm, but since 2017 has focused exclusively on discretionary trading accounts on Interactive Brokers.

Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

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