Bullish festival for the big technology companies in the United States, those that have taken the stock market to maximums and occupy privileged positions by market capitalization. Meta, the Facebook and Instagram company, soared more than 23% on the stock market this Friday, revaluing just over 230 billion dollars (more than 210 billion euros) in one day, after presenting the Thursday, results that far exceeded analysts' forecasts, although they later gave up some ground. It is the largest revaluation of a company in one day in history, exceeding the $190.9 billion that Apple advanced on November 10, 2022; Amazon's 190.8 billion on February 4 of that year and Nvidia's 184.1 billion on May 25 of last year.
In its rise this Friday it is accompanied by Amazon, which revalues 8%, the equivalent of about 130,000 million dollars, also after presenting results, and overtakes Alphabet by market capitalization. The one that lags somewhat behind this Friday is Apple, whose accounts have been less liked by the market.
The increase in percentage is lower than what Meta itself experienced a year ago after presenting results, although then it was coming off the first annual drop in income in its history and the price was well below the current one.
Meta closed 2023 with revenues of 134,902 million dollars (about 124,000 million euros at the current exchange rate), with a growth of 16% compared to 2022, according to the accounts published this Thursday by the company. Meta has reduced its workforce by 22% in one year and closed the year with 67,317 employees. The company has been able to make this growth compatible with a cost increase of only 1%, so that its profit skyrocketed to 39,098 million, 69% above the 23,200 million of the previous year, and very close to the record. of 39,370 million marked in 2021. The last quarter, in addition, was brilliant, with an increase in income of 25% and profit of 201%, in this case up to a record level of 14,017 million in one quarter.
“2023 was our year of efficiency, focused on making Meta a stronger technology company and improving our business to give us the stability necessary to deliver on our ambitious long-term vision for AI and the metaverse. And last year, we not only met our efficiency goals, but we returned to strong revenue growth,” Zuckerberg told analysts on Thursday. Meta expects revenue to be between $34.5 billion and $37 billion in the first quarter of this year, above analysts' forecasts.
The cherry on top for investors was the announcement that Meta was expanding its share repurchase program up to $50 billion and that it was introducing a dividend for the first time, which it hopes to distribute on a quarterly basis. “Returning capital to shareholders remains important to us,” Chief Financial Officer Susan Li said on the call with analysts. “We believe that our strong financial position and strong results will allow us to invest in the business while continuing to return capital to investors over time. Historically, we have done this through share buybacks, and while we expect to maintain an active share buyback program, we are modestly evolving our approach going forward, returning a portion of capital through a regular dividend, subject to quarterly board approval. “explained the directive.
All-time high
Meta shares already soared on Thursday outside of regular trading hours. This Friday, with the opening of the session, the promotion has been confirmed. The price has skyrocketed by up to 23%, from $394.78 per share at the close on Thursday to reach $485.96, its all-time high, with which the company reaches a valuation of more than 1.2 billions of euros.
“Meta's strategy of announcing buybacks and dividends just before the Fed starts cutting rates is a brilliant move,” says Thomas Monteiro, senior analyst at Investing.com, noting that the company not only showed an impressive ability to improve margins, but was also agile enough to direct any extra revenue to the right operations.
“Meta's recent financial achievements demonstrate its resilience and strong market position. This success has allowed the company to declare its inaugural quarterly dividend of $0.50 per share, in addition to approving an additional share buyback worth $50 billion,” says Farhan Badami, market analyst at eToro.
Amazon overtakes Alphabet
Amazon, for its part, also started the session with strong increases in the stock market after the results presented this Thursday. After a very strong Christmas quarter, Amazon closed 2023 with a turnover of $574,785 million, 12% more than the previous year, according to the accounts published by the company. Net profits were $30,425 million in 2023, compared to losses of $2.7 billion in 2022.
The shares of the e-commerce and cloud computing giant have been rising more than 8% on the Stock Market this Friday, which represents a revaluation of about 130,000 million dollars for the third company in the market by value on the Stock Market, with a capitalization of 1.78 trillion dollars, only behind Microsoft and Apple and slightly above Alphabet, which it overtook this Friday.
Microsoft, Apple, Alphabet, Amazon, Nvidia, Meta and Tesla have recently been dubbed the Magnificent Seven. They are the companies that went public in 2023 and the ones that continue to do so in 2024, although Tesla and, to a lesser extent, Apple have been somewhat left out of the group.
Yves Bonzon, chief investment officer at Swiss private bank Julius Baer, believes that “the end of the era of free money is hitting the average company harder than the Magnificent Seven, suggesting their dominance of the stock market will continue well into the future.” immediate”.
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