Meta Stock Has Never Been Cheaper. Is It Time to Buy the Former Facebook?

Andrew Bary

Meta Platforms ‘ stock is as cheap now as it has ever been since the company’s 2012 initial public offering. After a 32% fall in its shares, to $219, since Feb. 2, when its fourth-quarter earnings surprised investors, Meta Platforms (ticker: FB) now trades for 17 times projected 2022 earnings of $12.59 a share.

The only other time that Meta was close to being this inexpensive during its decade as a public company was in late 2018. Then it was a buying opportunity, as Barron’s said at the time. In the next 12 months, the stock rose more than 50%. Its average price-to-earnings ratio has been about 30 in the past five years, according to FactSet.

Shares of Meta, formerly Facebook , fell 0.8% on Monday, but were up 2% in premarket trading Tuesday.

In Meta’s fourth-quarter results and first-quarter outlook, there were worrisome signs that use of its apps was slowing and that its advertising sales faced hurdles. Barron’s argued that Meta now had “a quickly changing risk profile, one that looks uncomfortable even with a cheap stock.”

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