The stock market can appear a cruel place at times. Case in point: Meta (META) shares were on the up at Monday’s open after a Wall Street Journal article implied the social media giant is about to have a massive round of layoffs.
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The report suggested that Meta could make thousands of job cuts later this week due to a general decline in advertising spending and losses in the company’s metaverse segment, which contributed to a lackluster Q3 earnings report and a bleak outlook for the near future.
The cull would represent the first instance of a huge workforce reduction in the company’s history. Meta saw out Q3 with 87,000 employees on the payroll.
The company might be ready to let go of a huge chunk of its personnel, but at the same time it has no intention cutting back on its ambitious metaverse plans.
Its Reality Labs segment – which is home to the metaverse endeavor – has racked up losses of more than $9.4 billion this year but the company plans to keep on splashing out on it with Meta’s CFO anticipating Reality Labs’ operating losses will “grow significantly year over year.”
The company’s pivot to the metaverse might be a head scratcher for some but not to Tigress Financial analyst Ivan Feinseth, who sees the “recent pullback in price as a major buying opportunity.”
“Total daily and monthly active users continue to grow, and the Metaverse will emerge as a long-term growth driver,” the 5-star analyst went on to say. “Increasing strength in Reels, Messenger, and WhatsApp will continue to accelerate Business Performance trends, and ongoing Metaverse investment and development will drive significant long-term shareholder value creation.”
Accordingly, Feinseth reiterated a Strong Buy rating on the shares, backed by a Street-high price target of $260. The implication for investors? Upside of a strong 169% from current levels. (To watch Ellis’s track record, click here)
Overall, 24 other analysts join Feinseth in the bull camp but with an additional 10 Holds and 3 Sells, the stock gets a Moderate Buy consensus rating. Going by the $146.85 average target, invoestrs will be pocketing returns of 52% over the coming months. (See Meta stock forecast on TipRanks)
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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.
