Meta Platforms, Inc.
Meta Platforms, Inc. Fundamental Analysis
Meta Platforms, Inc. (META) shows strong financial fundamentals with a PE ratio of 27.35, profit margin of 30.08%, and ROE of 30.56%. The company generates $201.0B in annual revenue with strong year-over-year growth of 21.94%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 96.1/100 based on profitability, valuation, growth, and balance sheet metrics. The A grade reflects excellent fundamentals and strong overall stability.
Fundamental Health Score
We analyze META's fundamental strength across five key dimensions:
Efficiency Score
ExcellentMETA demonstrates superior asset utilization.
Valuation Score
WeakMETA trades at a premium to fair value.
Growth Score
ExcellentMETA delivers strong and consistent growth momentum.
Financial Health Score
ExcellentMETA maintains a strong and stable balance sheet.
Profitability Score
ExcellentMETA achieves industry-leading margins.
Key Financial Metrics
Is META Expensive or Cheap?
P/E Ratio
META trades at 27.35 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, META's PEG of 7.82 indicates potential overvaluation.
Price to Book
The market values Meta Platforms, Inc. at 7.61 times its book value. This suggests the stock is fully valued or overvalued on an asset basis.
EV/EBITDA
Enterprise value stands at 15.15 times EBITDA. This signals the market has high growth expectations.
How Well Does META Make Money?
Net Profit Margin
For every $100 in sales, Meta Platforms, Inc. keeps $30.08 as profit after all expenses.
Operating Margin
Core operations generate 41.44 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $30.56 in profit for every $100 of shareholder equity.
ROA
Meta Platforms, Inc. generates $16.52 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Meta Platforms, Inc. generates strong operating cash flow of $115.80B, reflecting robust business health.
Free Cash Flow
Meta Platforms, Inc. generates strong free cash flow of $46.11B, providing ample flexibility for dividends, buybacks, or growth.
FCF Per Share
Each share generates $18.29 in free cash annually.
FCF Yield
META converts 2.79% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
27.35
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
7.82
vs 25 benchmark
P/B Ratio
Price to book value ratio
7.61
vs 25 benchmark
P/S Ratio
Price to sales ratio
8.23
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
0.39
vs 25 benchmark
Current Ratio
Current assets to current liabilities
2.60
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.31
vs 25 benchmark
ROA
Return on assets percentage
0.17
vs 25 benchmark
ROCE
Return on capital employed
0.26
vs 25 benchmark
How META Stacks Against Its Sector Peers
| Metric | META Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 27.35 | 35.19 | Better (Cheaper) |
| ROE | 30.56% | 1155.00% | Weak |
| Net Margin | 30.08% | -127067.00% (disorted) | Strong |
| Debt/Equity | 0.39 | 0.41 | Neutral |
| Current Ratio | 2.60 | 4.71 | Strong Liquidity |
| ROA | 16.52% | -314918.00% (disorted) | Strong |
META outperforms its industry in 4 out of 6 key metrics, particularly excelling in Net Margin, but lagging in ROE.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Meta Platforms, Inc.'s 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
162.07%
Industry Style: Growth, Innovation, High Beta
High GrowthEPS CAGR
279.96%
Industry Style: Growth, Innovation, High Beta
High GrowthFCF CAGR
183.25%
Industry Style: Growth, Innovation, High Beta
High Growth