Meta Stock Soars as Company Returns Profits to Shareholders—Key Price Levels to Watch

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    Important points

    • Meta shares soared after the tech giant reported a better-than-expected quarterly earnings report and announced increased dividend payments and stock buyback authorizations.
    • The company reiterated its focus on investing in AI infrastructure and growing its Metaverse business.
    • Meta stock has been on a sharp upward trend after breaking out of the ascending triangle, and the stock's all-time high is now in the area of ​​future price support during a retracement.

    Meta Platforms Co., Ltd.


    Shares of Facebook's parent company Meta Platforms (META) rose on Friday after the member of the Magnificent Seven released a better-than-expected fourth-quarter earnings report on the back of a rebound in ad sales. It soared more than 17% ahead of the opening bell. First-ever dividend payment and approval for additional share buybacks.

    The $1 trillion tech giant announced on March 26 that it would issue a 50 cents per share dividend to investors and approved a $50 billion increase in its share buyback plan. Public companies typically return excess profits to investors through both dividend payments and share buybacks.

    The company reiterated its focus on artificial intelligence (AI) and the Metaverse. “We have made significant progress in aligning with our vision of advancing AI and the Metaverse,” Meta founder and CEO Mark Zuckerberg said in the company's earnings call. “We anticipate that our ambitious long-term AI research and product development efforts will require increased infrastructure investment beyond this year,” he added.

    Meta chief last month shared an Instagram video saying the company plans to buy NVDA chips for $9 billion this year to expand its AI computing capabilities. Despite the company's foray into the metaverse, the company's Reality Labs division recorded losses of $4.65 billion over the same period. However, due to strong year-end sales for the company's Quest VR headset, the division's sales came in at $1.1 billion, exceeding analysts' expectations of $804 million. On the recruiting front, Zuckerberg said he expects new hires to be minimal in 2024, with a focus on adding people to areas of the company where investment will increase.

    META stock has continued its sharp upward trend since breaking out of an ascending triangle, a chart pattern that indicates a continuation of the current trend. While the earnings-driven rally is likely to push the stock into unprecedented upside territory today, the 384 mark we set in September 2021 as a potential area for future price support during a retracement or correction. The task will be to focus on the all-time high of the meta around the dollar.

    Meta shares rose 17.1% to $462.35 at around 7:50 a.m. ET. The stock price has more than doubled in the past year.

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    As of the date this article was written, the author did not own any of the securities mentioned above.


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