How to buy META Facebook stocks

META Platforms Inc. (Facebook before October 2021) is in the top 10 most expensive tech companies in the world. The corporation owns Facebook, Instagram, WhatsApp, and Oculus. Its business is rather America-focused – about 46% of advertising revenues come from the US, 24% from Europe, and 21% from the Asian market. One could say that the corporation is on the cutting edge of the tech industry. In 2019, the company developed its own cryptocurrency Libra. In October 2021, it rebranded as Meta and set course for developing the Metaverse technology and software/hardware equipment for virtual worlds.

The article covers the following subjects:

In this review you will learn more about the prospects of the company and its shares, as well as various ways one could buy them.

META (ex. Facebook) Company History and Overview

Facebook is one of the fastest growing corporations in the world and has consolidated in the top 10 largest tech companies in the world. Its annual income is more than $100 billion, most of which is from advertising. It employs more than 58 thousand people and covers more than 100 countries of the world.

Facebook was founded in February 2004 by Mark Zuckerberg, Eduardo Saverin, Dustin Moskovitz and Chris Hughes. Facebook was created as a social network and by 2016 it totaled almost 2 billion users. At the moment, Facebook Inc. owns the world’s largest social network, as well as many other popular projects, including Instagram, Messenger, WhatsApp, and Oculus VR.

On October 28, 2021, Mark Zuckerberg renamed the corporation Meta Platforms. The main goal of the rebranding was to change the priority direction of development. META Platforms will continue to support the social networks and advertising tools, but the development of Metaverse technology will be the priority.

Zuckerberg’s company has been working on the Metaverse for several years:

  • In 2014, it bought Oculus that makes virtual reality headsets. After the rebranding it was renamed Meta Quest;

  • In 2019, it bought the startup CTRL-Labs, which develops software controlled via brain signals;

  • In 2021, the Horizon startup was launched – this is a platform that allows users to work, communicate and hold events in virtual reality;

  • In June 2022, the Facebook Pay wallet was rebranded. The new Meta Pay wallet gained some novel functions. Now its users can “safely manage their avatar and make purchases.” The ecosystem will cover all supported social networks of the company – Facebook, Instagram, WhatsApp, and the Messenger;

  • In June 2022, information appeared on the launch of the first Metaverse platform – Startoverse. This Metaverse was created by Meta Platforms for musicians together with Fender – the world renowned  manufacturer of guitars. Stratoverse is part of a larger Horizon Worlds project uniting digital worlds. So far, the new project is available exclusively on META Quest 2. Residents of the US, Canada and the UK can already try it out.

In the next few years Zuckerberg plans to increase the number of employees by 10 thousand people and invest about 10 billion dollars in the development of the Metaverse.

Why buy META stock

Buying META shares is a profitable investment but only if the investment portfolio is diversified. It makes sense to buy the shares only when the stock market touches the bottom and intends to go back up. The success of Meta Platform will depend on the following factors:

  • Future performance in the development of Metaverse tech. If the investments in the development and purchase of new startups do not pay off or the products themselves don’t do well, the company will lose its leading positions;

  • Performance of competitors. Despite the fact that Meta Platform is the leader of the tech sector, it is not quite fair to say it’s well ahead of the competitors. If Microsoft, Meta, Apple, Google and other corporations combine their efforts in the development of a single Metaverse, it could be a major growth driver;

  • General condition of the market. In case global economy and the US economy get better, investors will be more willing to buy securities, including Meta shares.

The growth forecast of the corporation’s stock in the long term is positive.

How much does META stock cost

The price of Meta shares for today, 13.09.2022, is 168.91 USD.

From the long-term perspective, the price of Meta shares have been going up and updating historical highs. In mid-2017, the value of the securities was about 150 USD per 1 share. By mid-2021, the value went up twice, bringing more than 25% per annum of stable income to investors. In September 2021, a Meta share cost already more than 380 USD.

Where and how to buy META Stock

If you want to buy Facebook shares, there are several options: you can buy them on the exchange or directly from counterparties outside the exchange. You can also purchase Meta CFDs on forex.

1. Buying securities on the exchange through a stock broker that lists Meta among available assets. In this scenario the investor becomes the actual owner of securities. Advantages: the transaction is safe and controlled by regulators, the exchange and external audit. Disadvantages: high commissions for all participants in the transaction.

2. Buying CFDs through a forex broker. In this case the investor does not become the actual owner of the shares and only earns on the difference in quotations. Advantages: low commission (almost no commission on the ECN account). Disadvantages: high risk of broker bankruptcy or refusal to pay.

In both cases, before buying the asset, you need to sign up and verify your identity with the broker.

3. Buying directly from counterparties. A large investor can contact the META Platforms office to buy securities. But direct transactions are mostly carried out between the owners of the asset – private investors or investment companies. The transaction is concluded by parties signing the contract of sale.

How can an individual buy META shares?

It is easier for an individual to buy META shares through an online broker, since transactions made on the OTC markets or directly with counterparties are usually in volumes of thousands US dollars or more. To buy the shares you need to:

  • carefully read the trading conditions of the broker. Pay attention to the spread, markup, swap, and withdrawal commission. Check for additional costs: brokerage account maintenance fees, clearing services, taxes, etc.;

  • open an account with the selected broker;

  • pass verification and make a deposit;

  • download and install the platform or use the browser platform.

The advantage of CFD trading is that in a few clicks you can open either long or short positions. The purchased asset is displayed on your account balance.

How to trade META Stock CFDs

Meta (Facebook) CFD trading algorithm:

1. To buy the asset, register and verify with the broker of your choice. If you want to practice on the virtual market with real quotes, click this link – no registration is required.

2. Conduct a preliminary analysis of quotes:

  • set the desired timeframe on the chart. For example, for intraday trading, use the M15-H1 intervals. For long-term investments – D1 and above;

  • add technical analysis indicators. Try to find strong resistance and support levels and trend lines in the chart. This will help to determine the further price movement.

3. In the right panel, set the trade volume in lots. Open the Trade Closing Conditions tab, specify the stop loss and take profit values.

4. Click “Sell” or “Buy”, depending on your forecast. The functions of the platform allows you to set market orders and limit orders.

The open position will be displayed in the bottom panel along with the floating financial result. You can close the position manually ahead of schedule.

META futures/option trading

META futures/options can only be traded through an exchange broker with access to exchanges where Meta Platforms shares are listed. Such brokers usually have a complex fee system with many commissions for transactions, storage of securities, receipt of statements, etc. CFDs (Contracts for Difference) are preferable for an investor with a modest capital. Although the investor does not become the actual owner of the securities, they earn on the difference in quotations.

CFD trading on META shares is available through brokers who will act as an intermediary between the investor and the exchange.

META trading hours

Trading session schedule: from 16.35 to 23.00 Monday to Friday (LiteFinance trading terminal time). Learn more about the instrument here.

META stock trading technical Information

Ticker

#META

Current price per share

168.91 USD

Founded

2004

Headquarters

Menlo Park, California, US

Main exchange

NASDAQ

CUSIP

30303M102

ISIN

US30303M1027

Par value

0.000006 USD

Shares outstanding

2,706,323,387

Leverage

1:50

Margin %

2%

Maximum volume

10,000 lots – a trader can buy or sell 10 thousand shares

META dividends

The company doesn’t pay out dividends to investors. Although it brings a net profit, the shareholders prefer to allocate it to business development and tech innovations. Given the new high-cost Metaverse direction, Meta Platforms’ dividend policy is unlikely to change in the next 5 years.

The main shareholders of META

The register of shareholders of the corporation is constantly changing. Facebook founder Mark Zuckerberg remains the main shareholder as of mid-2022. He owns about 14% of the shares, which is almost 2 times less than at the time the corporation went IPO (initial public offering) in 2012. Other investors holding 2-10%: Jim Breyer, Dustin Moskovitz, Yuri Milner, Eduardo Saverin, Sean Parker, Peter Thiel. All of them are founders of the corporation or representatives of investment funds.

Factors affecting META quotes

META quotes depend on macroeconomic and internal factors.

1. Macroeconomic factors:

  • overall economic growth of the United States and the world economy. Decline in unemployment, growth in GDP and other statistical indicators are pushing the entire stock market up. With negative statistics, the market goes down;

  • geopolitical factors. Trade wars and the pandemic, sanctions, administrative restrictions in certain jurisdictions have a negative impact on quotes;

  • state support for the industry, purchase of startups and entering new markets have a positive effect on quotes;

  • actions of competitors. For example, changes to Apple’s privacy policy in the new iOS 15 version resulted in a decrease in Meta’s ad revenue.

2. Internal factors:

  • financial performance (quarterly, annual). Revenue growth pushes quotes up;

  • corporate conflicts. Platform issues: hacks, user data leaks, etc. – all this negatively affects quotes.

Each of the factors can have a varying degree of influence at different times. The forecast takes into account the maximum possible number of fundamental factors and their strength. For example, positive financial results may be offset by general market stagnation.

Prospects for investing in META

After the rebranding carried out in the fall of 2021, the corporation headed for the development of the metaverse sector. According to analysts, in the future, metaverses will replace the familiar Internet by integrating virtual worlds into real life. META (Facebook) is actively working in this direction. In February 2022, it rebranded Oculus – the company specializing in hardware and software development for virtual and mixed reality. The new name is Meta Quest.

The lucrative prospects of the metaverse direction are also confirmed by the interest of other major tech corporations – Microsoft, Tencent, NVidia, Epic Games, and Amazon. So if META does not give up its plans and can withstand competition or merge with other developers, the corporation’s stock will reach new historical highs in the long term.

Facebook is in the TOP-5 of the largest tech giants, while continuing to develop other products. This means that the company’s shares will grow along with the NASDAQ index. As practice shows, despite local corrections and world global crises, it usually goes up.

What you need to do before buying META shares

  1. Prepare a preliminary forecast and assessment of the situation. Pay attention to the current share price, direction of movement, location relative to historical highs, and news background. If there are prerequisites for the decline of the quotes, wait for the bottom. Try to predict future price behavior as accurately as possible.

  2. Define the strategy. You have many options: long-term investing, scalping, intraday strategies, swing trading. Determine what your profit targets are, whether you need leverage, etc.

  3. Look for the best broker, do risk assessment, compare fees. For a private trader, buying shares through a broker is the easiest option. You should compare the trading conditions of brokers and compare the brokers themselves according to different criteria. Choose your broker in accordance with your trading strategy.

  4. Plan your actions in case of force majeure. You should consider a contingency plan: full or partial sale of the company’s shares, hedging, switching to other assets, etc.

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Pros and cons of META stock

Pros of trading META shares:

  • Competitive advantages. The corporation has repeatedly faced serious problems, including of user data privacy scandals, and got out without serious losses. The company also went through global crises, but each time showed new historical highs. Therefore, this asset is well suited for long-term investment.

  • Lucrative prospects. The corporation maintains leading positions in the communications sector and develops new directions. Meta Platforms may become one of the first companies to offer working solutions for the metaverse direction, thereby marking a new era in the social networks and virtual worlds segment.

  • Small price per share. The size of the CFD contract is 1 share. A private investor can buy the asset without even using leverage.

  • High liquidity. An asset can be quickly bought / sold in almost any volume with a minimum margin.

Cons of trading META shares:

  • Deep drawdowns. The price can sink by 5-8% in one day.

  • High dependence on advertising revenue. Because of this, the corporation has unstable revenue and periodically shows a drop in net profit.

  • Lagging behind competitors. Large corporations have been developing metaverse platforms and equipment for several years, actively collaborating in this direction with cryptocurrency startups. Meta Platforms’ main asset is Meta Quest, but there are relatively few key metaverse developments.

Conclusion. META stocks are suitable for long-term investment with a horizon of 5 years and for short-term trading on fundamental volatility with the opening of both long and short positions.

META stocks trading FAQs

Factors influencing quotes can be divided into two groups: global and local. Global factors include global events that affect the entire US stock market. For example, a change in the Fed’s discount rate, a slowdown in global economic growth, a general negative outlook, etc.

Internal factors affecting the share price:

  • Poor financial performance: falling net income and earnings per share, Meta Platforms divisions suffering operating losses (for example, Reality Labs).
  • Quarterly/annual performance falling short of the forecasts.
  • Failures in the launch of individual products of the corporation.
  • Global disruptions to Facebook services, user data leaks, corporate scandals, etc.

Most of the internal factors are difficult to predict. Therefore, to minimize risks, it is recommended to exit the positions before the release of financial statements.

Yes, if one of the following situations is currently observed on the market:

  • the US stock market is experiencing a stable long-term upward movement. The general news background is positive. For example, positive forecasts for the growth of US GDP and world GDP, a controlled level of inflation, good prospects for a lower discount rate, etc.;
  • there was a downward correction on the stock market under the pressure of fundamental factors. But the market bottomed out, the price began to pivot, and positive signals appeared (buying at the bottom).

You can also buy shares if any day you are expecting positive information about financial performance, product promotion, buying a promising startup, etc.

1. Contact the company’s representatives directly and conclude a contract of sale. This option is suitable for investors with significant capital.

2. Buy stocks at the bank if it is allowed by the trading conditions. In this case, the bank serves as an intermediary, a broker, not being a broker, in fact.

3. Buy stocks from individual investors in an over-the-counter market (OTC) using the contract of sale.

Individual investors without a large capital had better buy stocks through a brokerage company.

Price chart of META in real time mode

The content of this article reflects the author’s opinion and does not necessarily reflect the official position of LiteFinance. The material published on this page is provided for informational purposes only and should not be considered as the provision of investment advice for the purposes of Directive 2004/39/EC.

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