META

META(#FACEBOOK) weekly special report based On 1 Lot Calculation:

ONLINE ADVERTISEMENT INDUSTRY:

• MARKET SIZE: $465.5 BILLION IN 2021 AND EXPECTED TO GROW TO $1.089 TRILLION IN 2027. The global internet advertising market size was valued more than $465.5 billion in 2021, and is projected to reach $1.089 trillion by 2027, registering an average growth of 22.32% from 2021 to 2027.

• GLOBAL MARKETS: Google, Meta (formerly Facebook) and Amazon accounted for more than $7 in $10 (74%) of global digital ad spending in 2021, which is 47% of all money spent on advertising over that period.

• MARKET SHARE IN THE U.S.: Alphabet (Google) at 26.4%, META (Facebook) at 24.1%, Amazon 14.6%, Rest at 34.9%.

META:

• THE COMPANY: META(FACEBOOK) operates a social technology company. It builds applications and technologies that help connect communities and grow businesses. Meta is also heavily involved in advertisements, augmented and virtual reality.

• ONLINE ADVERTISEMENT: 98.3% of Meta’s total revenue came from advertising as of Q3 2022.

• STRONG POSITIVE REVENUE AND EARNINGS TREND (~107% FORECASTED REVENUE GROWTH BETWEEN 2018-2022): With the company forecast to make $116b for the year 2022, this would represent a growth of ~107% since 2018. This represents a Compounded Annual Growth Rate of about ~15% per year. Earnings for 2022 are forecast to come in at ~$27B. Should the forecast come in correct, this would represent a growth of 22% between 2018 - 2022. This represents a Compounded Annual Growth Rate of ~4% per year.

• META CONTINUES TO AGGRESSIVELY INVEST IN EXPANSION: Meta spent about 82% ($18.04B) of Q3 expenses in developing AI capabilities, advertising capabilities, click-to-messaging ads and its reels business, to challenge social media giant TikTok.

NEWS AND ANALYSIS:

• EVENT Q4 2022 EARNINGS FEBRUARY 1, 2023 (CONFIRMED: AFTERMARKET): Meta is expected to report a Q4 revenue of $31.57B and an earnings per share of $2.26.

• ACCORDING TO THE JEFFERIES INVESTMENT BANK, META WILL BE THE TOP PERFORMING INTERNET STOCK IN 2023: According to Jefferies, Meta will be the top performing mega-cap internet stock in 2023. The bank believes Meta still maintains strong revenue streams, and their recent focus on cost cutting should help the company continue to grow revenue and earnings.

• JP MORGAN RAISES PRICE TARGET ON META FROM $115 TO $150 DESPITE FORECASTED RECESSION: JP Morgan has outlined that Meta’s worst period is behind the company. According to JP Morgan, the company is set to grow revenue and earnings despite economic headwinds. The company has highlighted that Meta is up 35% from its recent bottom in November.

• PRICE ACTION: THE STOCK HAS HAD A DOWNWARD CORRECTION OF AROUND 77.00% FROM IT'S ALL TIME HIGH OF $382.18. The stock has fallen to its lowest rate since 2016, trading in November last year around $88. Meta was last trading around $132, and if full recovery follows recent all- time highs, the stock could see an upside of around ~187%. However, the stock may continue to decline.

• ANALYST OPINION: Morningstar is targeting $260, Mizuho forecasts $170, Wells Fargo forecasts $165. Goldman Sachs forecasts $165, while Citigroup forecasts $168.

META(#FACEBOOK), January 19, 2023
Current Price: 132.00

Example of calculation based on weekly trend direction for 1 Lot¹

1. 1.00 lot is equivalent of 1000 units

2. Calculations for exchange rate used as of 09:20(GMT) 19/01/2023

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