Company Overview: Meta Platforms, Inc (NASDAQ: META) develops technologies that facilitate social connection, community building, and business growth. Its products allow users to interact and share with friends and family via mobile devices, computers, virtual and mixed reality headsets, and wearable technology. The company operates through two main segments: Family of Apps (FoA) and Reality Labs (RL). 

 As per our previous Kalkine’s Low Carbon Research Report published on ‘META’ on 02^nd May 2025, Kalkine provided a ‘Buy’ stance on the stock at USD 592.61, based on “recent business and financial activities, improved capital efficiencies, evident by increased return on equity, asset and invested capital, key risk and current market trading levels”, giving a return of 11.26%, attaining resistance 1 and moving towards resistance 2.

Current Macro and company specific rationales:

• Trade Tensions Impacting Global Operations: The ongoing U.S.-China trade conflict, marked by China’s 30% tariff on U.S. imports as of May 12, 2025, poses significant challenges for Meta’s global operations, particularly in its supply chain for hardware products like Quest VR headsets, increasing production costs and potentially disrupting international market access, which could compress margins and limit growth.
• S. Recession Concerns Affecting Ad Revenue: With fears of a U.S. recession looming, as noted in economic discussions around May 2025, Meta’s core advertising business faces risks from reduced consumer spending and corporate ad budgets, potentially leading to lower revenue growth as businesses scale back on marketing expenditures during economic uncertainty.
• Exposure to Data Privacy Regulatory Pressures: Meta operates under intense scrutiny in heavily regulated markets, facing risks from evolving data privacy laws such as the EU’s Digital Markets Act, which could impose fines up to 10% of its 2024 revenue of USD 134.9 billion, necessitating costly compliance measures and potentially impacting its operational efficiency and profitability.
• Volatility in AI Investment Costs: Meta’s significant investments in AI to enhance its platforms and compete in the tech landscape, such as the development of AI-driven ad tools, are subject to cost volatility due to fluctuating expenses in technology infrastructure and talent acquisition, which could strain financial resources and pressure margins if returns on these investments are delayed amidst competitive pressures.

Noted below are the details of support and resistance levels provided in our previous report:

Relative Valuation (Price/Earnings based relative valuation):

META’s Daily Chart

Considering the current trading levels, volatile macro environment, lower intrinsic value as per P/E relative valuation, tariffs uncertainties, resistance 1 attainment, and risks associated, a ‘Sell’ rating is assigned to the “META” at the closing market price of USD 659.36, as of May 14, 2025. 

Note: This report may be updated with details around fundamental and technical analysis, price/ chart in due course, as appropriate

Note 1: Past performance is not a reliable indicator of future performance.

Note 2: The reference date for all price data, currency, technical indicators, support, and resistance level is May 14, 2025. The reference data in this report has been partly sourced from REFINITIV.

Note 3: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Note 4: Target Price refers to a price level that the stock is expected to reach as per the relative valuation method and or technical analysis taking into consideration both short-term and long-term scenarios.

Note 5: ‘Kalkine reports are prepared based on the stock prices captured either from the New York Stock Exchange (NYSE), NASDAQ Capital Markets (NASDAQ), and or REFINITIV. Typically, all sources (NYSE, NASDAQ, or REFINITIV) may reflect stock prices with a delay which could be a lag of 15-20 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.’