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In the fast-paced and cutthroat world of business, conducting thorough company analysis is essential for investors and industry experts. In this article, we will undertake a comprehensive industry comparison, evaluating Meta Platforms (NASDAQ:META) in comparison to its major competitors within the Interactive Media & Services industry. By analyzing crucial 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 | 27.76 | 8.15 | 8.56 | 1.39% | $26.85 | $42.04 | 26.25% |
| Alphabet Inc | 27.40 | 8.66 | 8.83 | 9.33% | $49.74 | $60.98 | 15.95% |
| Baidu Inc | 11.42 | 1.11 | 2.32 | 2.69% | $8.84 | $14.36 | -3.59% |
| Reddit Inc | 86.53 | 13.63 | 19.29 | 6.51% | $0.14 | $0.53 | 67.91% |
| Pinterest Inc | 11.92 | 4.65 | 5.92 | 0.82% | $0.0 | $0.8 | 16.93% |
| Bilibili Inc | 385.11 | 5.96 | 2.95 | 1.53% | $0.81 | $2.68 | 19.76% |
| FuboTV Inc | 9.95 | 11.81 | 0.78 | -4.64% | $-0.01 | $0.08 | -2.33% |
| Trump Media & Technology Group Corp | 153.56 | 1.69 | 820.30 | -1.26% | $-0.01 | $0.0 | 5.54% |
| ZoomInfo Technologies Inc | 37.66 | 2.38 | 3.13 | 2.51% | $0.09 | $0.27 | 4.74% |
| CarGurus Inc | 27.18 | 7.75 | 3.88 | 5.34% | $0.06 | $0.2 | 7.01% |
| Weibo Corp | 7.55 | 0.72 | 1.61 | 3.58% | $0.15 | $0.34 | 1.58% |
| Yelp Inc | 14.39 | 2.65 | 1.47 | 5.98% | $0.07 | $0.33 | 3.75% |
| Tripadvisor Inc | 30.85 | 2.74 | 1.15 | 5.67% | $0.09 | $0.49 | 6.44% |
| Ziff Davis Inc | 20.39 | 0.72 | 0.95 | 1.44% | $0.09 | $0.3 | 9.79% |
| Yalla Group Ltd | 9.11 | 1.56 | 3.86 | 4.96% | $0.03 | $0.06 | 4.15% |
| Average | 59.5 | 4.72 | 62.6 | 3.18% | $4.29 | $5.82 | 11.26% |
Through a thorough examination of Meta Platforms, we can discern the following trends:
The stock's Price to Earnings ratio of 27.76 is lower than the industry average by 0.47x, suggesting potential value in the eyes of market participants.
It could be trading at a premium in relation to its book value, as indicated by its Price to Book ratio of 8.15 which exceeds the industry average by 1.73x.
The Price to Sales ratio is 8.56, which is 0.14x the industry average. This suggests a possible undervaluation based on sales performance.
The company has a lower Return on Equity (ROE) of 1.39%, which is 1.79% below the industry average. This indicates potential inefficiency in utilizing equity to generate profits, which could be attributed to various factors.
The company has higher Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA) of $26.85 Billion, which is 6.26x above the industry average, indicating 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 indicates the proportion of debt and equity used by a company to finance its assets and operations.
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:
Among its top 4 peers, Meta Platforms has a stronger financial position with a lower debt-to-equity ratio of 0.26.
This indicates that the company relies less on debt financing and maintains a more favorable balance between debt and equity, which can be viewed positively by 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 the stock may be undervalued based on sales. The low ROE indicates lower profitability compared to peers, while high EBITDA and gross profit suggest strong operational performance. The high revenue growth indicates potential for future expansion in the Interactive Media & Services industry.
This article was generated by Benzinga's automated content engine and reviewed by an editor.
Posted In: META
