The ongoing market correction is hitting tech stocks particularly hard. Some popular social media and internet stocks are now significantly lower than their 52-week highs. Shares of Meta Platforms (META), the $1.5 trillion-dollar gorilla in the social media space, are down 22.2% from recent highs. Meanwhile, shares of other popular social media stocks like Pinterest (PINS) and Snapchat (SNAP) are down 30.4% and 48.7%, respectively.
Let’s examine these three social media stocks to determine which one is a compelling buy amid the current selloff.
Meta Platforms (NASDAQ:META)
With 3.35 billion people from all demographics using its platforms like Facebook and Instagram, Meta Platforms (META) is a social media dominator, but the market isn’t pricing it like one. Down more than 20% from its 52-week high, shares of Meta now trade for a very reasonable 22.8x consensus 2025 earnings estimates. This is only a small premium to the S&P 500 (SPX), which trades for 20.5x next year’s earnings. A slight premium to the broader market seems like a bargain for a company with Meta’s dominant market presence and history of strong performance.
As a company, Meta has fully matured yet continues to upscale. During Q4 2024, it posted 5% daily active user growth, which isn’t bad considering that 3.35 billion users, over 40% of the people on the planet, already use its products. Even better, the company grew revenue at an impressive 22% clip for the year, indicating that it is getting better at monetizing its massive user base.
Unlike the other stocks in this comparison, Meta is now a dividend stock after initiating a dividend in 2024. While its yield is just 0.35%, the company has already raised the payout from $0.50 a quarter in 2024 to $0.525 per quarter in 2025. It features a dividend coverage ratio of just 8.4%, meaning it has plenty of room to continue to raise dividends over time. These factors mean that Meta has strong potential as a dividend growth stock, especially as it grows earnings over time. In addition to paying a dividend, Meta also returns capital to shareholders via share repurchases, buying back a whopping $29.75 billion of shares in 2024.
Is META a Buy, Hold, or Sell?
Turning to Wall Street, META earns a Strong Buy consensus rating based on 44 Buys, three Holds, and one Sell rating assigned in the past three months. The average analyst META stock price target of $763.34 implies a 32% upside potential from current levels.
I’m bullish on Meta based on its reasonable valuation, impressive revenue growth, small but growing dividend, share buybacks, and its perfect 10 Smart Score. Its Strong Buy consensus rating and average analyst price target, implying a potential upside of over 30%, illustrate the attractive opportunity here.
Pinterest (NYSE:PINS)
Though smaller than Meta, Pinterest (PINS) is another popular social media platform that now boasts 553 million monthly active users worldwide. Pinterest describes itself as “a visual search and discovery platform where people find inspiration, curate ideas, and shop products—all in a positive place online.” The visuals-focused social media company emphasizes the positive environment it maintains, which could be a differentiating factor going forward based on the polarized climate in day-to-day dialogue in the U.S. found on other popular platforms like X and Facebook.
Amid the ongoing market correction, Pinterest is down 30.5% from its 52-week high. Pinterest stock (PINS) is cheaper than Meta Platforms and more affordable than the S&P 500, trading at just 17x forward earnings estimates.
Moreover, Pinterest is showing strong revenue growth, growing revenue by 19% in 2024. The company recorded its first-ever billion-dollar quarter in revenue, bringing in $1.15 billion in Q4 2024, good for 18% year-over-year growth. While Pinterest doesn’t report daily active users like Meta, monthly active users grew by 11%.
Unlike Meta, Pinterest does not yet pay a dividend, but like Meta, it returns capital to shareholders via share repurchases. The company recently announced a $2 billion share repurchase program, which is a significant sum considering its market cap of just $21.3 billion.
Is PINS Stock a Good Buy?
Turning to Wall Street, PINS earns a Strong Buy consensus rating based on 26 Buys, six Holds, and zero Sell ratings assigned in the past three months. The average analyst PINS stock price target of $45.65 implies a 45% upside potential from current levels.
I’m bullish on Pinterest based on its attractive valuation, massive share buyback in relation to its market cap, and bright estimates on Wall Street indicating more than 40% upside later this year.
Snapchat (NYSE:SNAP)
Down nearly 50% from recent highs, Snapchat (SNAP) has been hit the hardest of all three of social media stocks in this comparison. Despite the drawdown, Snapchat is still more expensive than Meta and Pinterest based on 2025 earnings estimates. Analysts expect the stock to earn $0.36 per share this year, meaning the stock trades at 24.6x 2025 estimates, a slight premium to Meta and a significant premium to Pinterest.
Snapchat’s revenue grew by 16% for 2024, which isn’t bad. However, despite being a much larger company, Meta’s revenue growth was lower than Pinterest’s and slightly lower than Snapchat’s. On the positive side, Snaphat posted daily active user growth of 9% to 453 million during the most recent quarter.
Snapchat does not pay a dividend but does buy back shares and announced a $500 million share buyback program in Q4 2024. While this is decent for a company with a $15 billion market cap, Pinterest’s share repurchase program is much more significant.
Is SNAP a Buy or Sell?
Turning to Wall Street, SNAP earns a Hold consensus rating based on six Buys, 24 Holds, and one Sell rating assigned in the past three months. The average analyst SNAP stock price target of $13.19 implies a 48% upside potential from current levels.
While the nearly 50% upside implied by the analyst price target is tempting, the fact that the vast majority of analysts have a Hold rating on the stock and its mediocre Smart Score is concerning. I’m neutral on Snapchat based on these factors and its relatively high valuation despite its slower revenue growth compared to META and PINS.
Indomitable Social Media Uptrend
Taking it all in, I’m excited about the opportunities presented by both Meta Platforms and Pinterest but far less enthused about Snapchat. Snapchat isn’t a poor stock per see, but it’s hard to justify a premium when it’s growing slower than both Pinterest and Meta Platforms, especially when considering its significantly smaller size than Meta.
I am bullish on Meta based on its reasonable valuation, impressive revenue growth for a company of its massive scale, small but growing dividend, and share buyback program. Investors who cut through the noise of the current market selloff and invest in Meta will be rewarded over the long term.
Lastly, Pinterest is a bit more speculative than Meta, but I also find it to be an attractive stock opportunity. Its outperform-equivalent Smart Score on TipRanks, bullish consensus rating on Wall St., and average analyst price target implying an upside of over 45% all highlight the strong potential. I’m bullish on Pinterest based on its cheap valuation (the lowest in this group and significantly cheaper than the broader market), user and revenue growth, and massive stock buyback program.