Meta Platforms (NASDAQ:FB) is due to report earnings on Wednesday after market close.
Analysts are looking for EPS of $2.55 on sales of $28.35 billion. We share below key comments from Meta Platforms analysts on the Street.
Monness, Crespi, Hardt’s Brian White (Buy, PT $375): “We believe Meta will continue to benefit from the long-term digital ad trend, participate in accelerated digital transformation, and innovate in the metaverse; however, we expect ad headwinds to persist, regulatory scrutiny to continue, and geopolitical turbulence to weigh on economic growth.”
Mizuho’s James Lee (Buy, PT $325 from $425): “We recently did a round of checks on FB advertising trends. Key points: (1) The seasonal decline in 1Q22 is about 20% steeper than normal due to macro, continued challenges in iOS privacy, and mix shift to IG Reels; (2) From a vertical perspective, we saw weaknesses in retail, financials, and autos that contributed nearly 60% of spending for these ad agencies. With increased issues of supply chain, we expect FB’s ad revenue growth could be flat YoY in 2Q22, and the rate of recovery in 2H22 could be slower than anticipated.”
Bank of America’s Justin Post (Buy, $290): “We continue to see a difficult set up for Online Media in 2Q but a strong case for 2H acceleration. Quarter and outlook have elevated uncertainty given advertiser pullbacks on Ukraine and other macro-economic uncertainty, reopening impact on users/usage, IDFA issues, FX headwinds, and very tough 2Q comps, but we think a below-Street 2Q guide is expected. Potential positives on the call could include commentary on progress with Reels monetization and IDFA workarounds, or more clarity on why the Metaverse investment will have good returns for Facebook (NASDAQ:FB). We see Meta’s valuation at 13x 2023 GAAP EPS estimate, or 8x estimated core FB EPS adjusting for cash, messaging, and FRL (vs S&P at 18x) as attractive.”
FB stock price is down 1% in pre-market Monday.
By Senad Karaahmetovic