Meta Platforms: Invest In The Future

Nov. 11, 2022 7:01 PM ETMeta Platforms, Inc. (META)GOOG, GOOGL, NKE11 Comments
Yannick Frey profile picture
Yannick Frey
1.04K Followers

Summary

  • Meta Platforms, Inc.'s layoff of 13% of the total workforce will yield huge cost savings that could lead to higher earnings.
  • Meta Platforms is a strongly profitable company. The operating margin was 20% last quarter. With Meta cutting costs, the operating margin could rise sharply.
  • Meta has been authorized to repurchase more than $18B of shares. At the current share price, this represents a buyback yield of more than 6%.
  • When Meta Platforms' shares are bought in the open market, demand rises and supply falls. This should increase the share price sharply.
  • The EV/EBIT ratio has fallen to a very favorable value of 6.8 for Meta Platforms.

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Introduction

Those who bought Meta Platforms, Inc. (NASDAQ:META) during the IPO and held it until 2022 have made huge returns. Meta is a growth stock that also shows strong profit margins. The stock's valuation was expensive for years, but Meta

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Meta Financial Results - SEC and Author's Own Graphical Representation

Meta Financial Results (SEC and Author's Own Graphical Representation)

Meta's cash flow highlights - SEC and author's own calculations

Meta's cash flow highlights (SEC and author's own calculations)

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Data by YCharts

This article was written by

Yannick Frey profile picture
1.04K Followers
Yannick is a passionate investor from the Netherlands who shares his analyses with other investors on Seeking Alpha. In doing so, he looks for companies with the following characteristics:1. Companies that are growing in both revenue, earnings and free cash flow.2. Companies that have excellent growth prospects.3. Stocks with favorable valuations.He prefers steadily growing companies with high free cash flow margins, dividend stocks and stocks with generous share repurchase programs.Disclaimer: My articles do not provide financial advice, they reflect my own findings and insights.

Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, but may initiate a beneficial Long position through a purchase of the stock, or the purchase of call options or similar derivatives in META over 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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