Meta Poised to be the Best Performer Among the 'Mag Seven' This Earnings Season, Says Gerstner

If one needs to pick a stock among the 'Magnificent Seven', Meta should be the best choice, according to renowned hedge fund manager Brad Gerstner.

As the chairman and CEO of Altimeter Capital, a firm that manages a whopping 18 billion capital, Gerstner is particularly impressed by Meta's commitment to efficiency and its potential for increased monetization, especially through the use of artificial intelligence tools and AI wearable glasses.

Gerstner, who holds Meta as one of his top investments, has also lauded the company's remarkable performance, which includes a 13% increase in stock value just this year. However, he cautioned that the tech giants are under immense pressure this week due to the significant rally in their stock prices throughout the year. He warned of a potential Tesla-like reaction if there are any misses on expectations, referring to Tesla's 12% drop following its report of lower-than-expected earnings for the fourth quarter.

Meta's CEO Mark Zuckerberg had earlier declared 2023 to be the company's year of efficiency, in response to an open letter from Gerstner that criticized the company's extravagant spending. This new direction led to significant cost reductions and propelled the company's stock to a staggering 194% increase in 2023, marking it the most successful year in the company's history. Despite the initial skepticism raised by investors like Gerstner, it appears that Meta has successfully steered towards greater efficiency and profitability.

The soon-to-be-released quarterly results from Meta will offer a deeper look into whether these optimistic views are mirrored in the company's financial performance. However, Gerstner emphasized, If there was one name that I think is better positioned this week, its Meta. He added, I think people still underappreciate the commitment to efficiency at Meta.