Meta: Quantifying Remaining Upside And The Reality Labs Burden

Summary:

  • The amazing turnaround of Meta gained steam after second quarter results and guidance that exceeded expectations.
  • Fueled by the recovery in ads and industry-leading targeting capabilities, Meta was able to sustain its momentum, showcasing an impressive 11% growth and a 441 bps adjusted margin expansion.
  • CEO Mark Zuckerberg and CFO Susan Li tried to keep investors honest, as they repeatedly reiterated the company’s focus on Reality Labs, which surpassed $40B in cumulative losses.
  • Let’s quantify the remaining upside and assess the magnitude of value destruction that is caused by Reality Labs.

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panida wijitpanya

The amazing turnaround of Meta (NASDAQ:META) gained steam after second quarter results and guidance that exceeded expectations. I reiterate a Buy rating with a price target of $427 per share.

Introduction

Fueled by a recovery in the ads


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