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Amidst the fast-paced and highly competitive business environment of today, conducting comprehensive company analysis is essential for investors and industry enthusiasts. In this article, we will delve into an extensive industry comparison, evaluating Meta Platforms (NASDAQ:META) in comparison to its major competitors within the Interactive Media & Services industry. By analyzing critical financial metrics, market position, and growth potential, our objective is to provide valuable insights for investors and offer a deeper understanding of 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 | 26.61 | 9.44 | 10.64 | 9.65% | $25.12 | $39.02 | 21.61% |
| Alphabet Inc | 26.83 | 8.39 | 8.34 | 7.96% | $39.19 | $57.39 | 13.79% |
| Baidu Inc | 10.69 | 1.04 | 2.17 | 2.69% | $8.84 | $14.36 | -3.59% |
| Reddit Inc | 87.97 | 15.45 | 21.11 | 3.88% | $0.07 | $0.45 | 77.69% |
| Pinterest Inc | 11.95 | 4.66 | 5.94 | 0.82% | $0.0 | $0.8 | 16.93% |
| Bilibili Inc | 385.69 | 5.97 | 2.95 | 1.53% | $0.81 | $2.68 | 19.76% |
| Trump Media & Technology Group Corp | 174 | 1.92 | 929.52 | -1.26% | $-0.01 | $0.0 | 5.54% |
| CarGurus Inc | 28.90 | 8.23 | 4.12 | 5.34% | $0.06 | $0.2 | 7.01% |
| ZoomInfo Technologies Inc | 43.76 | 2.25 | 3.05 | 1.5% | $0.09 | $0.26 | 5.21% |
| Weibo Corp | 7.97 | 0.77 | 1.70 | 3.58% | $0.15 | $0.34 | 1.58% |
| Yelp Inc | 15.31 | 2.82 | 1.57 | 5.98% | $0.07 | $0.33 | 3.75% |
| Tripadvisor Inc | 34.23 | 3.04 | 1.27 | 5.67% | $0.09 | $0.49 | 6.44% |
| Ziff Davis Inc | 23.89 | 0.84 | 1.11 | 1.44% | $0.09 | $0.3 | 9.79% |
| FuboTV Inc | 18.26 | 2.89 | 0.79 | -1.98% | $0.01 | $0.08 | -2.81% |
| Taboola.com Ltd | 83 | 1.06 | 0.61 | -0.45% | $0.02 | $0.14 | 8.71% |
| Average | 68.03 | 4.24 | 70.3 | 2.62% | $3.53 | $5.56 | 12.13% |
By conducting an in-depth analysis of Meta Platforms, we can identify the following trends:
The Price to Earnings ratio of 26.61 is 0.39x lower than the industry average, indicating potential undervaluation for the stock.
With a Price to Book ratio of 9.44, 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.
With a relatively low Price to Sales ratio of 10.64, which is 0.15x the industry average, the stock might be considered undervalued based on sales performance.
The company has a higher Return on Equity (ROE) of 9.65%, which is 7.03% above the industry average. This suggests efficient use of equity to generate profits and demonstrates profitability and growth potential.
Compared to its industry, the company has higher Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $25.12 Billion, which is 7.12x above the industry average, indicating stronger profitability and robust cash flow generation.
Compared to its industry, the company has higher gross profit of $39.02 Billion, which indicates 7.02x above the industry average, indicating stronger profitability and higher earnings from its core operations.
With a revenue growth of 21.61%, which surpasses the industry average of 12.13%, the company is demonstrating robust sales expansion and gaining market share.
The debt-to-equity (D/E) ratio assesses the extent to which a company relies on borrowed funds compared to its equity.
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 has a stronger financial position compared to its top 4 peers, as evidenced 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 perceived as a positive indicator by 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 book value. The low PS ratio implies that Meta Platforms is generating strong revenue relative to its market capitalization. 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
