📱 META PLATFORMS: ANALYSIS 📱

📱 META PLATFORMS: ANALYSIS 📱

Meta Platforms, Inc. engages in the development of products that enable people to connect and share with friends and family through mobile devices, personal computers, virtual reality and mixed reality headsets, augmented reality, and wearables worldwide. It operates through two segments, Family of Apps (FoA) and Reality Labs (RL). The FoA segment offers Facebook, which enables people to build community through feed, reels, stories, groups, marketplace, and other; Instagram that brings people closer through instagram feed, stories, reels, live, and messaging; Messenger, a messaging application for people to connect with friends, family, communities, and businesses across platforms and devices through text, audio, and video calls; Threads, an application for text-based updates and public conversations; and WhatsApp, a messaging application that is used by people and businesses to communicate and transact in a private way. The RL segment provides virtual, augmented, and mixed reality related products comprising consumer hardware, software, and content that help people feel connected, anytime, and anywhere. 

Based on a sample of the last year [3Q/25  TTM], its average margins have been:

- Gross margin: ≈ 81.8%

- Operating margin: ≈ 42.3%

- EBITDA margin: ≈ 51.9%

- Net margin: ≈ 36.7%

- Debt Net / EBITDA: ≈ 0.416x

Pros:

- Oligopolistic position in social media networks

- Healthy net debt (despite its increase)

- A relatively stable gross margin that allows you to control future processes and financial flows

Cons:

- The need for hyper-investment in AI will compromise margins

- Deterioration of margins (mainly Operating Margin) reflected in EPS loss

- Slightly high valuation

Based on the last report, their normalized annual EPS was ≈ $23.25 USD and its last average ROIC [TTM] was ≈ 36.7%. If an annual average Forward PER 25 is set as a benchmark with an EPS intensity of ± 0.3525x, the potential forward spread target for the next 12 months could be:

- Optimistic: ≈ $783.23 USD

- Neutral: ≈ $581.32 USD

- Pessimistic: ≈ $376.41 USD

At least, an EPS of $8.1947 USD is required for the next quarter, to keep the metrics.

In other hand, if an annual average Forward EV/EBITDA 15 is set, an EBITDA increases of ± 26%, a Net Debt increases of 0.0%, a Dividends increase of 0% and Shares Outstanding increases of ± 0.42%, the potencial spread price target for the next 12 months could be:

- Optimistic: ≈ $725.41 USD

- Neutral: ≈ $566.31 USD

- Pessimistic: ≈ $409.18 USD

Finally, according to its current P/S ratio, a possible spread for the next 12 months might be at:

- P/S 10: ≈ $752.7 USD

- P/S 5: ≈ $376.35 USD

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J. Joel Padilla

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