Meta Platforms Stock: Buy, Hold, or Sell?

Core Business Performance - Meta's advertising business has shown solid performance, with revenue growth of 22% and operating income growth of 39% in the last year [2][3] - The company generated $133 billion in revenue and$63 billion in operating profit in 2023, marking a significant turnaround from challenges faced in 2022 [3][4] - Daily active users (DAU) reached 3.35 billion, growing by 5% year over year, indicating strong user engagement across its platforms [4][5] Advertising Business Dynamics - In 2024, ad impressions and pricing increased by 11% and 10% respectively, highlighting the attractiveness of Meta's advertising business [5] - The integration of artificial intelligence (AI) into its applications is expected to enhance user engagement and sustain advertising growth [6][7] Reality Labs Investment - Despite the success of its core business, Meta's Reality Labs continues to incur significant losses, with operating losses increasing from $16 billion to$18 billion in 2024 [8] - Revenue from Reality Labs remained stagnant at $2 billion, indicating challenges in monetizing this segment [8][9] - The potential market size for the metaverse is projected to reach$508 billion by 2030, prompting Meta to invest early despite current losses [9][10] Stock Valuation and Investor Considerations - Meta's stock currently has a price-to-earnings (P/E) ratio of 28, which is on the higher end of its historical range, suggesting that it may not be a bargain at this valuation [12] - The company ended 2024 with strong advertising growth, but the ongoing losses from Reality Labs could impact overall profitability [13] - While the stock is not recommended for selling, potential investors are advised to wait for a more favorable entry point [14]