Meta Platforms, Inc. (NASDAQ:FB) earnings came out below expectations, with slowing user growth and a declining earnings per share (EPS). In addition, the cofounder and CEO, Mark Zuckerberg, stated that the corporation is experiencing numerous problems such as; inflation, users moving to other platforms, and supply chain disruptions for advertisers.
So, what does all of this mean for Meta stock investors? Below is the technical analysis for the stock and the stock forecasts for the coming months.
Meta stock technical analysis
Source – TradingView
On February 3rd, Meta stock plummeted down 38.74% from all-time highs, trading at just $232 per share. The big question that lingers is: Is this drop in Meta stock price a case of catching a falling knife or a perfect opportunity to buy in?
Well, the truth is that this isn’t the first time the Meta stock, previously known as Facebook, has found itself in hot water; back in 2018, this huge drop in share prices happened. Facebook has taken a lot of hits recently; however, the recent drop may be the worst. On February 3rd, Facebook had the largest one-day drop in Wall Street history, losing more than 120 billion dollars in market value.
From the technical analysis, Meta stock’s short-term and long-term trends are both negative. The stock has been trading in a rather wide range of $216.15 – $332.73 during the last month, and it is currently trading near the range’s lows.
In addition, Meta stock is currently trading around the bottom of its 52-week range, which is also a negative sign. Now, the S&P 500 Index is currently trading in the center of its 52-week range, this means that Meta stock is one of the stocks that are lagging behind the markets index.
So, is the stock a buy?
Whilst it’s not great for investor confidence to see such huge fluctuations in a mega-capped stock, it’s worth noting that this has happened before, and Facebook recovered. However, with recent events resulting in the largest single-day drop in stock market history, with Meta losing 232 billion dollars in value and with the stock quickly dropping down the pecking order of mega-cap stocks, it’s quite concerning whether will we see another recovery of the stock, so the stock isn’t a buy at this moment.