Here's Why Meta Platforms (META) Fell More Than Broader Market

In the latest close session, Meta Platforms (META) was down 2.55% at $638.18. This change lagged the S&P 500's daily loss of 1.52%. On the other hand, the Dow registered a loss of 1.56%, and the technology-centric Nasdaq decreased by 1.78%.

Shares of the social media company witnessed a loss of 2.07% over the previous month, trailing the performance of the Computer and Technology sector with its loss of 1.66%, and outperforming the S&P 500's loss of 2.25%.

Market participants will be closely following the financial results of Meta Platforms in its upcoming release. The company's earnings per share (EPS) are projected to be $6.67, reflecting a 3.73% increase from the same quarter last year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $55.34 billion, up 30.78% from the year-ago period.

For the annual period, the Zacks Consensus Estimates anticipate earnings of $29.75 per share and a revenue of $249.25 billion, signifying shifts of +26.65% and +24.02%, respectively, from the last year.

Investors should also note any recent changes to analyst estimates for Meta Platforms. These revisions help to show the ever-changing nature of near-term business trends. As such, positive estimate revisions reflect analyst optimism about the business and profitability.

Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate has moved 0.02% higher within the past month. Meta Platforms is holding a Zacks Rank of #3 (Hold) right now.

Digging into valuation, Meta Platforms currently has a Forward P/E ratio of 22.01. This signifies a premium in comparison to the average Forward P/E of 20.32 for its industry.

Investors should also note that META has a PEG ratio of 1.01 right now. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. META's industry had an average PEG ratio of 1.13 as of yesterday's close.

The Internet - Software industry is part of the Computer and Technology sector. With its current Zacks Industry Rank of 149, this industry ranks in the bottom 40% of all industries, numbering over 250.

The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow META in the coming trading sessions, be sure to utilize Zacks.com.

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This article originally published on Zacks Investment Research (zacks.com).

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