Investor optimism surrounding potential TikTok ban boosts Meta Platforms stock, driven by ad revenue growth

From Nasdaq: 2024-12-10 23:59:57

Investor optimism around the potential TikTok ban has driven Meta Platforms stock (META) up 5% in a month. A federal appeals court upheld a law requiring ByteDance to find a new owner for TikTok’s U.S. operations by Jan 19, 2025, or face a ban. Meta has seen 83% returns since early 2022, with revenue up 32.5% to $156 billion and net income margin expanding to 35.6%.

Meta benefits from rising ad impressions, higher ad prices, and increased daily active users. The company’s AI push is driving more effective targeting for advertisers, leading to revenue growth. Despite a recent decline in META stock due to TikTok’s emergency motion, Meta’s strong performance is driven by its advertising business and AI initiatives.

While META stock has surged 74% this year, its historical returns have been volatile. The Trefis High Quality Portfolio has outperformed the S&P 500 consistently, offering better returns with less risk. With Meta fully valued at $615 per share, investors should consider the risks, including the impact of AI investments on earnings growth. META stock is trading at 29x trailing earnings, slightly above its historical average of 22x.

In Dec 2024, META stock has returned 7% MTD, 74% YTD, and 435% since 2017. Comparatively, the S&P 500 returned 1% MTD, 28% YTD, and 172% since 2017. Trefis Reinforced Value Portfolio showed 0% MTD, 24% YTD, and 822% since 2017. Investors can explore market-beating portfolios with Trefis for better insights and investment decisions.



Read more at Nasdaq: What’s Driving META Stock Higher?