6. Meta Platforms, Inc. (NASDAQ:META)
Number of Hedge Fund Holders as of Q4: 262
Zweig-DiMenna Associates’ Equity Stake: $40.11 Million
Formerly named Facebook, Inc., Meta Platforms, Inc. (NASDAQ:META) is an American multinational technology conglomerate based in Menlo Park, California. The company owns and operates Facebook, Instagram, Threads, and WhatsApp, among numerous other products and services.
Meta Platforms, Inc. (NASDAQ:META) delivered outstanding financial results for Q4 2024, surpassing analyst expectations with a 21% year-over-year revenue increase to $48.4 billion, exceeding Wall Street’s projection of $47 billion. Diluted earnings per share (EPS) surged 50% year over year to $8.02, well above the estimated $6.76. This strong performance drove Meta’s stock up nearly 9% in the following days, although some of those gains have since been relinquished. Investors remain optimistic about Meta’s core digital advertising and social media businesses, which continue to thrive despite economic challenges. The company’s expanding artificial intelligence (AI) initiatives, including AI-powered content recommendations and marketing strategies, have further strengthened its market position.
Rowan Street Capital stated the following regarding Meta Platforms, Inc. (NASDAQ:META) in its Q4 2024 investor letter:
“Meta Platforms, Inc. (NASDAQ:META): Investment Initiated: April 2018: Internal Rate of Return (IRR*): 22% *IRR represents the annualized rate of return on an investment, accounting for the timing and magnitude of cash flows over the holding period.
For META, our 22% IRR aligns closely with the company’s compounded growth in earnings per share (EPS) and free cash flow per share during the 6 years holding period.
Looking ahead, Meta is expected to grow its revenues, earnings, and free cash flow per share at mid-teens rates over the next two years. There’s a good possibility that it could exceed these estimates, considering the breadth of growth initiatives currently in place, such as advancements in Al, monetization of Reels, expansion into business messaging, and the ongoing development of the metaverse…” (Click here to read the full text)
Looking ahead, Meta Platforms, Inc. (NASDAQ:META) plans to invest between $60 billion and $65 billion in fiscal 2025, primarily in AI infrastructure, generative AI development, and data center expansion to support advanced AI models. The company’s AI-powered Meta assistant, with over 700 million monthly users by the end of 2024, underscores its growing presence in AI-driven consumer applications. Additionally, Meta’s Family of Apps, which includes Facebook, Instagram, Messenger, Threads, and WhatsApp, continues to demonstrate significant engagement, with over 3.3 billion daily active users in December 2024. While trading at 27.5 times forward earnings may seem high, the company’s dominance in social media, digital advertising, and AI innovation justifies its valuation. With revenue and EPS projected to grow by 14.6% and 5.4% in fiscal 2025, Meta Platforms, Inc. (NASDAQ:META) remains a compelling investment opportunity, offering both technological leadership and long-term financial strength.
