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In the fast-paced and highly competitive business world of today, conducting thorough company analysis is essential for investors and industry observers. In this article, we will conduct an extensive industry comparison, evaluating Meta Platforms (NASDAQ:META) in relation to its major competitors in the Interactive Media & Services industry. Through a detailed examination of key financial metrics, market standing, and growth prospects, our objective is to provide valuable insights and illuminate company's performance in the industry.
Meta is the largest social media company in the world, boasting close to 4 billion monthly active users worldwide. The firm's "Family of Apps," its core business, consists of Facebook, Instagram, Messenger, and WhatsApp. End users can leverage these applications for a variety of different purposes, from keeping in touch with friends to following celebrities and running digital businesses for free. Meta packages customer data, gleaned from its application ecosystem and sells ads to digital advertisers. While the firm has been investing heavily in its Reality Labs business, it remains a very small part of Meta's overall sales.
| Company | P/E | P/B | P/S | ROE | EBITDA (in billions) | Gross Profit (in billions) | Revenue Growth |
|---|---|---|---|---|---|---|---|
| Meta Platforms Inc | 26.01 | 9.23 | 10.40 | 9.65% | $25.12 | $39.02 | 21.61% |
| Alphabet Inc | 27 | 8.44 | 8.40 | 7.96% | $39.19 | $57.39 | 13.79% |
| Baidu Inc | 10.98 | 1.07 | 2.23 | 2.69% | $8.84 | $14.36 | -3.59% |
| Reddit Inc | 87.03 | 15.29 | 20.88 | 3.88% | $0.07 | $0.45 | 77.69% |
| Pinterest Inc | 11.74 | 4.58 | 5.83 | 0.82% | $0.0 | $0.8 | 16.93% |
| Bilibili Inc | 363.76 | 5.63 | 2.78 | 1.53% | $0.81 | $2.68 | 19.76% |
| Trump Media & Technology Group Corp | 179.78 | 1.98 | 960.38 | -1.26% | $-0.01 | $0.0 | 5.54% |
| CarGurus Inc | 27.94 | 7.96 | 3.98 | 5.34% | $0.06 | $0.2 | 7.01% |
| ZoomInfo Technologies Inc | 40.32 | 2.07 | 2.81 | 1.5% | $0.09 | $0.26 | 5.21% |
| Weibo Corp | 7.93 | 0.76 | 1.69 | 3.58% | $0.15 | $0.34 | 1.58% |
| Yelp Inc | 14.90 | 2.74 | 1.52 | 5.98% | $0.07 | $0.33 | 3.75% |
| Tripadvisor Inc | 31.90 | 2.84 | 1.19 | 5.67% | $0.09 | $0.49 | 6.44% |
| Ziff Davis Inc | 22.77 | 0.80 | 1.06 | 1.44% | $0.09 | $0.3 | 9.79% |
| FuboTV Inc | 19.16 | 3.03 | 0.82 | -1.98% | $0.01 | $0.08 | -2.81% |
| Hello Group Inc | 10.27 | 0.72 | 0.82 | -1.28% | $0.53 | $1.01 | -2.64% |
| Average | 61.11 | 4.14 | 72.46 | 2.56% | $3.57 | $5.62 | 11.32% |
By analyzing Meta Platforms, we can infer the following trends:
A Price to Earnings ratio of 26.01 significantly below the industry average by 0.43x suggests undervaluation. This can make the stock appealing for those seeking growth.
With a Price to Book ratio of 9.23, which is 2.23x the industry average, Meta Platforms might be considered overvalued in terms of its book value, as it is trading at a higher multiple compared to its industry peers.
The Price to Sales ratio is 10.4, which is 0.14x the industry average. This suggests a possible undervaluation based on sales performance.
With a Return on Equity (ROE) of 9.65% that is 7.09% above the industry average, it appears that the company exhibits efficient use of equity to generate profits.
The company has higher Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $25.12 Billion, which is 7.04x above the industry average, indicating stronger profitability and robust cash flow generation.
The gross profit of $39.02 Billion is 6.94x above that of its industry, highlighting stronger profitability and higher earnings from its core operations.
The company's revenue growth of 21.61% exceeds the industry average of 11.32%, indicating strong sales performance and market outperformance.
The debt-to-equity (D/E) ratio is an important measure to assess the financial structure and risk profile of a company.
Considering the debt-to-equity ratio in industry comparisons allows for a concise evaluation of a company's financial health and risk profile, aiding in informed decision-making.
In light of the Debt-to-Equity ratio, a comparison between Meta Platforms and its top 4 peers reveals the following information:
Meta Platforms exhibits a stronger financial position compared to its top 4 peers in the sector, as indicated by its lower debt-to-equity ratio of 0.25.
This suggests that the company has a more favorable balance between debt and equity, which can be seen as a positive aspect for investors.
The low PE ratio of Meta Platforms suggests that the company's stock price is relatively undervalued compared to its earnings. In contrast, the high PB ratio indicates that investors are willing to pay a premium for the company's assets. The low PS ratio implies that Meta Platforms is generating strong revenue relative to its market value. On the other hand, the high ROE, EBITDA, gross profit, and revenue growth highlight the company's strong profitability and growth potential compared to its industry peers in the Interactive Media & Services sector.
This article was generated by Benzinga's automated content engine and reviewed by an editor.
Posted In: META
