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In today's rapidly changing and fiercely competitive business landscape, it is essential for investors and industry enthusiasts to thoroughly analyze companies. In this article, we will conduct a comprehensive industry comparison, evaluating Meta Platforms (NASDAQ:META) against its key competitors in the Interactive Media & Services industry. By examining key financial metrics, market position, and growth prospects, we aim to provide valuable insights for investors and shed light on company's performance within 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 | 28.22 | 8.28 | 8.71 | 1.39% | $26.85 | $42.04 | 26.25% |
| Alphabet Inc | 28.01 | 8.85 | 9.02 | 9.33% | $49.74 | $60.98 | 15.95% |
| Baidu Inc | 11.07 | 1.08 | 2.25 | 2.69% | $8.84 | $14.36 | -3.59% |
| Reddit Inc | 94.46 | 14.88 | 21.06 | 6.51% | $0.14 | $0.53 | 67.91% |
| Pinterest Inc | 12.21 | 4.76 | 6.06 | 0.82% | $0.0 | $0.8 | 16.93% |
| Bilibili Inc | 405.45 | 6.28 | 3.10 | 1.53% | $0.81 | $2.68 | 19.76% |
| FuboTV Inc | 11.53 | 11.11 | 0.79 | -1.98% | $0.01 | $0.08 | -2.81% |
| Trump Media & Technology Group Corp | 161.33 | 1.78 | 861.85 | -1.26% | $-0.01 | $0.0 | 5.54% |
| ZoomInfo Technologies Inc | 47.26 | 2.43 | 3.29 | 1.5% | $0.09 | $0.26 | 5.21% |
| CarGurus Inc | 28.06 | 7.99 | 4 | 5.34% | $0.06 | $0.2 | 7.01% |
| Weibo Corp | 7.66 | 0.74 | 1.64 | 3.58% | $0.15 | $0.34 | 1.58% |
| Yelp Inc | 15.17 | 2.79 | 1.55 | 5.98% | $0.07 | $0.33 | 3.75% |
| Tripadvisor Inc | 32.07 | 2.85 | 1.19 | 5.67% | $0.09 | $0.49 | 6.44% |
| Ziff Davis Inc | 21.51 | 0.76 | 1 | 1.44% | $0.09 | $0.3 | 9.79% |
| Yalla Group Ltd | 9.44 | 1.62 | 4 | 4.96% | $0.03 | $0.06 | 4.15% |
| Average | 63.23 | 4.85 | 65.77 | 3.29% | $4.29 | $5.82 | 11.26% |
After a detailed analysis of Meta Platforms, the following trends become apparent:
The Price to Earnings ratio of 28.22 is 0.45x lower than the industry average, indicating potential undervaluation for the stock.
It could be trading at a premium in relation to its book value, as indicated by its Price to Book ratio of 8.28 which exceeds the industry average by 1.71x.
Based on its sales performance, the stock could be deemed undervalued with a Price to Sales ratio of 8.71, which is 0.13x the industry average.
The Return on Equity (ROE) of 1.39% is 1.9% below the industry average, suggesting potential inefficiency in utilizing equity to generate profits.
With higher Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $26.85 Billion, which is 6.26x above the industry average, the company demonstrates stronger profitability and robust cash flow generation.
The gross profit of $42.04 Billion is 7.22x above that of its industry, highlighting stronger profitability and higher earnings from its core operations.
With a revenue growth of 26.25%, which surpasses the industry average of 11.26%, the company is demonstrating robust sales expansion and gaining market share.
The debt-to-equity (D/E) ratio is a financial metric that helps determine the level of financial risk associated with a company's capital structure.
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.
When examining Meta Platforms in comparison to its top 4 peers with respect to the Debt-to-Equity ratio, the following information becomes apparent:
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 0.26.
This suggests that the company has a more favorable balance between debt and equity, which can be seen as a positive aspect for investors.
For Meta Platforms, the PE ratio is low compared to peers, indicating potential undervaluation. The high PB ratio suggests the market values the company's assets highly. A low PS ratio implies sales are relatively cheap. The low ROE may indicate lower profitability compared to peers. The high EBITDA and gross profit suggest strong operational performance. High revenue growth indicates potential for future expansion.
This article was generated by Benzinga's automated content engine and reviewed by an editor.
Posted In: META
