According to experts, there are at least 2 major catalysts for the Meta stock that investors should know about. These 2 factors have the ability to push the Meta stock higher in 2023.
The first main catalyst is related to the reels (short videos) and their monetizations. If you look at the 2nd quarter 2022 results, you can see that the revenue run rate and the user engagement are really good. There are also signs that the rate of monetization of Reels will exceed the expert's and even the company's expectations.
Right now, the revenue run rate for the short videos (reels) is better than for Stories. Another thing that can increase the revenue from reels is the use of artificial intelligence, which has the ability to improve the monetization rate.
During Q2 2022, Meta revealed that the watch time for its Reels increased by 15%.
The 2nd catalyst for growth in Meta stocks is their moderate hiring pace which will eventually improve the profit margins for the company.
The company also announced that they are very carefully looking at the hiring pace as they enter into 2023. The company also plans to let go of more people during the next year. So, in short, the company will be making more money while spending less on paying wages.
One of the major factors which increased the operating costs for Meta was its higher number of staff in the 2nd quarter of 2022. According to experts, this was also the major reason why Meta missed its earning forecasts.
It seems that Meta is getting ready to face uncertain economic conditions around the world. In times like this, the easiest strategy is to decrease the headcount will working on optimizing the revenue models.
So based on these two factors, it makes sense to think that Meta Platforms will perform well in 2023. But as with everything involving investing and stocks, anything can happen at any time!