Meta Platforms Stock: Buy, Hold, or Sell?

Lawrence Nga, The Motley Fool

Sat, Mar 29, 2025, 5:45 AM 5 min read

Meta Platforms' (NASDAQ: META) shares have been through a remarkable ride over the last two years after hitting a low in 2022.

Thanks to its successful turnaround efforts, the social media giant has delivered another year of solid performance, sustaining the momentum achieved in 2023. Unsurprisingly, its solid performance drove the stock price to a new all-time high in 2024.

But investors might now be facing other dilemmas. Is now the time to buy the stock? Or, for those who already own the stock, is now a good time to sell?

Last year marked another period of solid performance by Meta's core advertising business. Revenue grew by 22%, while income from operations jumped 39%.

Such a performance was remarkable, considering that Meta was already generating $133 billion in revenue and $63 billion in operating profit in 2023. It's even more impressive if we consider that the tech giant faced huge challenges with stagnant revenue and falling profits in 2022. In other words, it went from being a problem child to reaching new heights in both revenue and profits.

Meta's solid comeback reflects the strength of its business model. With 3.35 billion daily active users (DAU), Meta is the biggest social media networking company -- it owns Facebook, Messenger, Instagram, and WhatsApp. Better still, this number continues to grow -- it expanded by 5% year over year in the latest quarter.

As owner of the largest social network, Meta offers a compelling service for users to stay connected with friends and family. In return, users remain highly engaged with its services, enabling the tech giant to grow its advertising business over time. In 2024, ad impressions and ad pricing rose by 11% and 10%, respectively, underscoring the attractiveness of this business.

Meta has continuously worked on its product offerings to delight its users, the latest being incorporating artificial intelligence (AI) into its apps. For instance, the company improves its content feed to users by employing the latest AI technology, making sure users get the right content to keep them engaged. It also expects that Meta AI, a highly intelligent and personalized assistant, will reach its users in the near future.

Assuming that it delivers on its AI promises, Meta is well-positioned to keep its user base even more engaged in the near future. That, in turn, should keep its advertising business robust (and growing) for a while.

While Meta's core business continues to fire on all cylinders, its investment in the metaverse business remains a question mark.