5 Best Virtual Reality Stocks to Buy

2. Meta Platforms, Inc. (NASDAQ:META)

Number of Hedge Fund Holders: 184

Meta Platforms, Inc. (NASDAQ:META) is the holding company for the world’s largest social network Facebook, and other social platforms such as Instagram and WhatsApp. The company is headquartered in Menlo Park, California.

Meta Platforms, Inc. (NASDAQ:META) is taking an all out approach toward developing the metaverse. Through its social network Facebook, which has one of the largest user bases in the world, the company aims to create a virtual world where users can interact with each other and even with its chief executive officer Mr. Mark Zuckerberg.

Meta Platforms, Inc. (NASDAQ:META) also sells a virtual reality headset called the Meta Quest Pro, which lets users immerse themselves in a virtual reality environment. The company has also partnered with NBC to provide virtual experiences to Quest users. 184 out of the 895 hedge funds polled by Insider Monkey during this year’s second quarter had invested in the company.

Meta Platforms, Inc. (NASDAQ:META)’s largest investor is Ken Fisher’s Fisher Asset Management which owns 11.5 million shares that are worth $1.8 billion.

Rowan Street Capital mentioned the company in its Q2 2022 investor letter. Here is what the fund said:

“Meta Platforms, Inc. (NASDAQ:META) gets a lot of negative news coverage, and there has been a general negative sentiment floating around the company for some time. But let’s take a look at what’s “under the hood”. In recent quarter, Family of Apps daily active people hit 2.88 billion, while monthly active people grew to 3.65 billion — these are mind-boggling numbers. In the past 12 months, they earned $33.20 in revenue per user, which amounted to $118 billion in total revenues. On that, they generated almost $40 billion in operating profits (34% operating margin) and $58.5 billion in operating cash flow. That is far from a disaster! In the most recent quarter, investors have been concerned that total revenues declined 1% (Y/Y) and are estimated to decline 6% (Y/Y) in Q3, which reflects weak advertising demand. At the same time, Meta is continuing to reinvest in its business with total expenses growing 22% (Y/Y) in Q2, which caused operating profit and earnings per share (EPS) to decrease 32%. Meta is in the midst of an economic cycle that is having a broad impact on the digital advertising business. They are being disciplined on spending while still investing in those areas that will position to drive growth as the economic environment improves.