How to Trade Meta After Q1 Performance

Meta Platforms was the best performing FAANG stock in the first quarter of 2023. FAANG is the acronym for tech stocks Facebook (now Meta), Apple, Amazon, Netflix and Google (now Alphabet) and was created by the host of “Mad Money” on CNBC Jim Cramer. He has now updated the acronym to MAMAA to represent the biggest tech stocks: Microsoft, Alphabet, Meta, Amazon and Apple.  

Shares in Meta were down more than 75% from its record high in July 2021 to a multi-year low in October 2022. However, in the first quarter of 2023, the share price closed 76% higher. Learn more about what led to this outperformance and whether analysts believe more upside or downside is to come.

• The Invest.MT5 account allows you to buy real stocks and shares from 15 of the largest stock exchanges in the world.

All trading is high risk and you can lose more than you risk on a trade. Never invest more than you can afford to lose as some trades will lose and some trades will win. Start small to understand your own risk tolerance levels or practice on a demo account first to build your knowledge before investing. 

Trading Meta Stock After Q1 Performance

Meta shares were up 76% in the first quarter of 2023, far above the next best performer of the FAANG stocks Apple which was up around 26%. This is a huge turnaround from the bear market crash Meta shares faced in 2022.  

There have been a few reasons attributed to the rally in its share price. Meta – along with most other tech giants – announced a big wave of job cuts. More than 21,000 employees are set to lose their jobs over two phases. As unfortunate as this, it tends to be a positive for shareholders as any savings can go into growth or the bottom line.  

Over the last few years, Meta lost ground in the social platform space to TikTok. However, TikTok is now facing scrutiny from law makers in the US and the UK doubting its long term future. Investors see this as a potential for Meta’s Facebook – one of the original social platforms.  

It its latest fourth-quarter earnings report, Meta missed analyst estimates but did announce a $40 billion share buyback. This is a form of giving back to shareholders in which companies buy back their own shares to reduce the number of shares in the open market and thereby increasing the value of the remaining shares.  

CEO Mark Zuckerberg stated that 2023 is the ‘Year of Efficiency’ helping the stock to surge more than 18% after its earnings release. However, concerns still remain. Meta lost around $10 billion in advertising revenue last year due to new privacy policies from Apple for its iPhone. While, Meta is now using AI to target users with ads a lot better it remains to be seen if it can pickup the shortfall already lost.  

Another concern is the cash burning Metaverse project which lost $13.7 billion last year and $10.2 billion the year before. Investors may be hoping for more of a shift into artificial intelligence (AI) which helped shares such as Nividia surge 90% higher in the first quarter alone.  

Much of the good news regarding Meta may already be priced into the stock but there is still a chance for the trend to continue if it can fulfill its promises to shareholders.

Meta Stock Forecast - What do the Analysts Say?

According to analysts polled by TipRanks for a Meta stock forecast in the past 3 months, there are currently 38 buy, 7 holds and 3 sell ratings on the stock. The highest price level for a Meta stock forecast is $307.00 with the lowest price target at $110.00. 

The average price target for a Meta stock forecast is $231.38.

An Example Trading Idea for the Meta Stock Price

An example trading idea for the Meta share price could be as follows:  

• Buy the stock on a break above $218.00 to allow for current volatility. 
• Target just below the highest analyst price target of 307.00. 
• Keep your risk small at a maximum of 5% of your total account.   
• Time Line = 1 – 6 months  
• If you buy 10 Meta shares:  
  • If target is reached = $890.00 potential profit ($307.00 - $218.00 * 10 shares).

Remember that markets go up and down and it is unlikely the share price will move up in a straight line. In fact, it may even go much further down before it rises, especially considering how far Meta’s share price has already risen.

Be sure to exercise good risk management and always know how much you could potentially lose on a trade and the risks involved, as well as the costs.

With the Admirals Invest.MT5 account you can buy and sell US stocks with a commission from $0.02 per share. This means buying 10 shares in Meta stock would result in a commission of $0.20 ($0.02 * 10 shares) for executing a per-side transaction.

There is a low minimum transaction fee of $1. So, the example trading idea above would result in a commission of just $1 overall! 

How to Buy Meta Stock in 4 Steps  

With Admirals, you can buy shares in companies like Meta with a low commission of just $0.02 per share and a low minimum commission of just $1 on US stocks. 

1. Open an account with Admirals to access the Trader’s Room.   
2. Click on Trade on one of your live or demo accounts to open the web platform.   
3. Search for your stock at the bottom of the Market Watch window and drag the symbol onto the chart.   
4. Use the one-click trading feature, or right-click and open a trading ticket to input your trade size, stop loss and take profit level. 

Click on the banner below to trade Meta stock today! ▼▼▼ 

Do You See the Meta Stock Price Moving Differently?   

Remember that all analytics and trading ideas are based on the personal view and experience of the author.  

If you believe there is a higher chance Meta's share price will move lower, then you can also trade short from a CFD (Contracts for Difference) trading account which Admirals also provide.  

The Trade.MT5 and Trade.MT4 account allows you to speculate on the price direction of stocks and shares using CFDs.  

This means you can trade long and short to potentially profit from rising and falling stock prices. Learn more about CFDs in this How to Trade CFDs article. 

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