Meta Platforms (NASDAQ:META) plans to unveil a Twitter-rival microblogging app called Threads on Thursday. The launch comes at an opportune time when Elon Musk’s Twitter is losing its mojo and facing increasing criticism since the Tesla (NASDAQ:TSLA) boss bought it for $44 billion last year.
Meta to Challenge Musk’s Twitter
Meta’s Threads appeared in the Apple (NASDAQ:AAPL) app store on Tuesday ahead of the launch this week. Although Threads is an independent app, it has been built such that Instagram users will be able to join it with their existing user names. This would help Threads leverage Instagram’s extensive user base and grow quickly.
Meta is known to give its competitors a tough time by launching rival products. For instance, the company launched its short-form video feature “Reels” to combat the rapidly growing popularity of ByteDance’s TikTok app. A few years back, the company launched the “Stories” feature on Instagram to compete with Snapchat (NYSE:SNAP).
Meta’s Thread app is being seen as a strong contender, given the growing angst toward Twitter due to several changes made to the platform since Musk’s acquisition. Musk eliminated 80% of Twitter’s workforce to cut down costs. He reinstated several banned accounts, including that of former U.S. President Donald Trump. This move along with a rise in hate speech and inappropriate content on Twitter has pushed advertisers away. Most recently, Musk irked Twitter users when it announced a limit on how many posts could be viewed per day on the platform.
Amidst the growing criticism against Twitter, users have been moving to rival microblogging sites like Mastodon and Bluesky. Meta’s CEO Mark Zuckerberg is launching Threads at an apt time when users are looking for a strong alternative to Twitter. Meanwhile, it is interesting to note that Zuckerberg and Musk are reportedly gearing up to indulge in a cage fight, which could be an exhibition match with a charitable angle to it.
Is Meta a Good Stock to Buy Now?
Of the 31 Top Wall Street Analysts covering Meta stock, 29 have a Buy rating while two have a Hold recommendation. With shares rallying 138% year-to-date, the average price target of $295.06 implies 3.2% upside. It is worth noting that the top analysts have an impressive track record of generating attractive returns from their recommendations. Moreover, each analyst has a remarkable success rate.
Last week, Citigroup analyst Ronald Josey increased the price target for Meta Platforms to $360 from $315 and maintained a Buy rating. The analyst highlighted that Reels is experiencing greater advertiser adoption due to its “Lo-Fi” (low fidelity) approach to ads, newer ad products, and continued rise in engagement growth.
