Here Is Why Of All The Big Tech Stocks, Meta Is The Most Promising.

Technology stocks have taken a beating, but not all of them in the same way. It’s time to investigate Meta Platforms (META). Accelerating profits drove the industry up early this year, but third-quarter earnings need to be better to deliver a substantial lift to tech or tech-related companies.

Alphabet (GOOGL) is down roughly 6% since reporting better-than-expected results on Oct. 24 after rising 50% to begin the year. The Technology Select Sector SPDR exchange-traded fund (XLK) is down approximately 8% from its late-July peak. 

Meta (META) has fared slightly better. Since the results, the stock is down only 0.1% and has recovered more than half of its post-release loss. It’s down only 5% from its 52-week high, outperforming all but Microsoft (MSFT) among the Big Seven. Furthermore, the stock has sustained price support at $275 and appears to be on the rise.

Rich Ross, Evercore’s head of technical research, who advocates purchasing shares, believes META is the absolute and relative best on the board.

This is more than simply a technical play. Meta’s business is solid and is expanding in big tech stocks. Its third-quarter sales increased by 25% to $34.1 billion, above expectations of $33.6 billion, thanks to higher-than-expected average revenue per user. Meta continues to monetize its user base by increasing user time spent on its platforms, most of which can be attributed to Instagram reels.

In addition, the corporation is layering in additional commercials, utilizing artificial intelligence to better match customers with the appropriate ads. According to Mizuho analyst James Lee, these approaches are assisting the firm in gaining market share from rival advertising providers and increasing sales.

Meta has also controlled expenses, resulting in higher profit margins and earnings of $4.39 per share, more than double the previous year and above projections of $3.64. The company’s warning about weaker ad spending in the coming quarters, as companies brace for weakening consumer demand in the face of rising interest rates, was one wrinkle.

Nonetheless, Wall Street remains optimistic about the company’s future prospects, with average forecasts for 2024 profits up by 0.4% following the results released in big tech stocks. Overall, “these trends give us more confidence in multi-year revenue growth,” says Morgan Stanley analyst Brian Nowak, citing the company’s recent performance in its new possibilities.

Analysts predict midteens annualized profit growth over the next two years, which should propel the stock upward, especially given its low valuation. Shares are trading at slightly under 18 times earnings-per-share expectations for the next 12 months, which is about in line with the S&P 500‘s multiple, although the index is anticipated to increase profits at nearly half Meta’s rate.

This should keep market participants purchasing the stock for a while.