‘Keep busy about Metaverse until the basics are forgotten, no matter how investors lose interest.’
Meta Platfrom Inc's Facebook has seen its shares decline day by day due to declining investor interest.
Although Facebook shares are cheaper than average value shares, they are still not cheap enough for bargain-hunting in the stock market.
The main reason for the problem is because investors have begun to lose confidence in Meta Platfrom Inc’s abilities in growing its core business and yielding huge expenditures in realizing the metaverse strategy shift.
According to Lightshed Partners analyst Richard Greenfield, increased competitive conditions mixed with a lack of visibility on metaverse shifts, in addition to regulatory risk have made ‘excitement on meta stocks diminish’.
It is common knowledge that Meta shares have previously declined sharply after the quarterly earnings report in February saw a big selling session that reduced the market value by US $ 500 billion.
As a result, several analysts from JPMorgan Chase & Co to BMO Capital Markets have downgraded Meta's rating and warned investors about the company's prospects which are considered less promising.
Meta also now sees sales of its shares less than 15 times its estimated earnings, further making it cheaper than the S&P 500 value index of companies like Deere & Co which are not expensive compared to profits.
Citing sources from Bloomberg, Meta shares fell 2/3 of the shares in the S&P 500 index.
This is the first time Meta has faced the issue since the company was listed on a major United States (US) exchange.
Adding to the grief, the bounce from the 2 -year low recorded by Meta on March 14 still failed to impress investors as overall it still fell 44% from its best record in September.
Roosevelt Investment Group’s senior portfolio manager, Jason Benowitz, argues that there is a lot of uncertainty from Meta’s growth prospects, so it’s no wonder why so many investors are acting ‘out’ of it.
In addition, uncertainty about Mark Zuckerberg’s involvement into the metaverse also contributed to the factor of investor loss of interest in Meta -linked stocks.
