social media actions have been in the spotlight lately as they are expected to benefit from the possible TikTok ban by the Biden Administration. Growing competition from TikTok, Apple’s (AAPL) The iOS privacy update and the impact of macro pressures on ad spending had a big impact on social media companies last year. Wearing TipRanks Stock Comparison Toolwe place Meta Platforms (NASDAQ: GOAL), BREAK (New York Stock Exchange:SNAP), and Bilibili (NASDAQ: BILI) against each other to pick the stock that earns Wall Street’s consensus Strong Buy rating despite near-term pressures.
Meta Platforms (NASDAQ:META)
Meta impressed investors with better than expected fourth trimester revenue. However, weak ad spend continues to weigh on the company’s results, which fell for the third consecutive quarter.
Meta is taking several steps to reduce costs and optimize its business to improve its profitability. The company recently announced that reduce its number of employees by 10,000 and close about 5,000 additional roles that he hasn’t filled yet. The new round of job cuts follows more than 11,000 layoffs announced in November 2022.
Meta calls 2023 the “Year of Efficiency” and now expects its full-year spending to be in the range of $86 to $92 billion, down from the previous estimate of $89 to $95 billion.
Are META shares a good buy?
Several analysts raised their price targets after Meta’s announcement of further job cuts. Stifel analyst mark kelley raised his price target for Meta Platforms to $230 from $210 and reiterated a Buy rating. Having said that, Kelley marginally lowered its revenue growth estimates as you anticipate some level of disruption given that a large portion of the job cuts are expected in April and May.
Overall, Wall Street’s Moderate Buy consensus rating is based on 36 Buys, six Holds and three Sells. Average META Stock Price Target of $224.88 suggests almost a 15% upside. Stocks are up more than 63% so far in 2023.
Snap faced multiple headwinds last year, but managed to deliver revenue growth of 12%. The company warned investors that it expects continued weakness in the first quarter of 2023, with revenue expected to decline 2-10% year-over-year.
At the recently held Investor Day, management discussed various topics, including augmented reality. The company is optimistic about its long-term potential, saying that at its current growth rate, it could reach more than a billion people in the next two to three years.
It’s worth noting that Snap recently launched My AI, a new OpenAI-powered chatbot for its Snapchat+ subscribers. The new chatbot is built with the latest version of OpenAI’s GPT technology. The buzz created by OpenAI ChatGPT tool has done several tech giants accelerate your initiatives in the AI space.
Is Snap a Buy, Sell or Hold?
After Investor Day, Truist Financial Analyst Youssef Squali he stated that he “walked away from Snap’s Investor Day cautiously optimistic.” The analyst noted that the company mentioned various monetization initiatives and products to revive growth supported by an expanding user base that now exceeds 750 million monthly active users.
That said, Squali prefers to stay on the sidelines as Snap navigates the current headwinds and until it begins to see the company’s initiatives “translate back into ad revenue growth,” which he doesn’t expect until the second half. of 2023.
With four buys, 16 holds and three sells, Wall Street has a hold consensus rating for Snap’s stock. Average Adjust Stock Price Target of $10.63 suggests that the stock could be range-bound in the near term. Stocks have advanced more than 19% year-to-date.
Bilibili (NASDAQ: BILI)
China-based Bilibili is one of the leading video sharing and streaming platforms in the country. The company markets itself as the online home for Gen Z fans of anime, comics, and games.
Earlier this month, the company announced its fourth quarter results. Revenue grew 6% to RMB 6.1 billion ($890.6 million). Higher value-added services revenue helped offset the impact of lower advertising revenue and a decline in mobile gaming revenue due to a lack of new game releases in the quarter. Meanwhile, better cost controls helped Bilibili cut its net loss by 29% to RMB 1.5 billion ($217.1 million).
Bilibili ended the fourth quarter with 326 average monthly active users, reflecting a 20% year-over-year increase.
What is the target price for Bilibili shares?
Earlier this month, Citigroup analyst brian gong upgraded Bilibili to Buy from Hold and kept the price target unchanged at $28. Gong expects company’s first-quarter 2023 revenue It will be roughly flat year-over-year, but it projects growth to pick up starting in the second quarter, driven by new game releases and a reacceleration of value-added services.
Wall Street’s Strong Buy consensus rating for Bilibili is based on three Buys and one Hold. Average Target price of BILI shares $27.60 indicates 24.4% upside potential. Shares are down 6% since the beginning of this year.
Social media companies could remain under pressure on the close team due to the impact of macro challenges on ad spend. Analysts are very bullish on Bilibili and see further upside potential in the stock from current levels based on paring of losses and improvement in the top line as the year progresses.
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