- Needham Analyst Laura Martin repeated underperformance on Meta Platforms, Inc META.
- She admired Mark Zuckerberg’s commitment to a vision despite overwhelming odds.
- The analyst highlighted Meta’s sharp contrast to Apple Inc AAPL events. Mark Zuckerberg was on screen 90% of the time, making it clear that he is the project manager and CTO for the Metaverse. While AAPL highlights specific apps on its iOS platform, Meta shared its stage with the CEOs of both Accenture Plc ACN and microsoft corp MSFT – big guns for a big vision. Meta also announced Metaverse partnerships with Comcast Corp CMCSA nbc, miracle, Zoom Video Communications, Inc. ZMRay-Ban and several other large companies.
- Related: Facebook Parent Unveils $1,500 VR Headset To Work With Microsoft On Office, Xbox Gaming For Quest Devices
- Short term, The analyst feared the consensus estimates were too high based on Meta’s promise of increased investment in the Metaverse. At the same time, it intentionally slowed its revenue growth to better compete with TikTok.
- She believed that financial discipline is secondary to Meta’s long-term vision.
- The analyst advised investors to remain on the sidelines while assessing several structural valuation risks, including changes in consumer behavior, competition, erosion of competitive advantages, regulatory risks, and metaverse investment risks.
- JMP Analyst Andrew Boone reiterated Market Outperform on Meta and price target of $215.
- He acknowledged that the metaverse and its limitations today are very early in use cases. He believed augmented reality (AR) could unlock new social, work, and play experiences when he left Meta Connect, and felt the company is driving AR up the S-curve as it improves hardware, developer tools, and experiences .
- also read: Meta Analyst says Quest Pro uptake will likely be slow due to these 2 reasons
- Price promotion: META shares traded 0.88% lower at $127.41 on the last check Wednesday.
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