Meta Platforms (NASDAQ:META) stock delivered a solid second quarter, posting a 16% rise in net income and 11% growth in advertising revenue, its primary income source. The uptick in daily user engagement and the launch of generative AI tools signal a promising future. Meta boasts the largest user base with 3.07 billion daily active users, solidifying its dominant position in social media.
Currently, META stock trades at $312, poised to maintain its strength above $300. There will be more success and innovation from Meta in the coming years, making it an ideal stock to buy and hold for a long time. Here are two reasons you should add this tech giant to your portfolio.
META Stock is Strong and Resilient
In my previous META stock article, I expressed how bullish I am for the said stock. In fact, I believe it’s a millionaire-maker for investors and some of them are just sleeping on it, which is a big mistake.
The company formerly known as Facebook may have rebranded, but it’s still a social media powerhouse with generative AI prowess. While the metaverse is part of its vision, long-term investors value META stock for its robust cash-flow business and growth potential. Despite substantial investments in the metaverse, many steadfast investors find reason to stick with Meta.
Meta, which owns Instagram, Facebook, Messenger, and WhatsApp, boasts an enormous user base of 3.07 billion daily active users. Its lucrative advertising business ranks second only to Alphabet (NASDAQ:GOOG). Despite challenges, Meta saw its advertising revenue grow 11.8% year-over-year to $31.7 billion with a 41% operating margin.
These numbers could further improve with successful investments or a streamlined focus. In addition to digital ads, Meta plans to diversify revenue streams through ad-free, subscription-based memberships, starting in Europe.
Excellent Innovation on Social Media Platforms and Products
Meta Platforms has been quite active in its product development of late. The company has opened up the Sharing to Reels mobile-app widget to all developers, a strategic move to boost content sharing. Additionally, rumors suggest a potential Trends feature introduction in Threads, highlighting trending topics for users.
Owning META stock goes beyond social media. It offers long-term exposure to the potential smart glasses revolution, a promising tech trend. Meta Platforms has partnered with Ray-Ban to develop augmented reality smart glasses, including an AI assistant and livestreaming capabilities. While it’s a risk, Meta is known for embracing innovation, and this venture into AR glasses holds revenue potential.
Don’t Hesitate, Buy META Now
On October 25, the company will release its Q3 results, with analysts projecting earnings of $3.64 per share, a 122% increase. META stock recently broke through an early entry point at 312.87 on October 6, although it’s facing resistance at the standard cup base buy point of 326.20.
Meta Platforms led the way in social media tech with generative AI. The company actively sought to reduce its dependence on ad revenue, diversify its business, and enhance its core operations. Given these positive outcomes, I see no need to consider other mega-cap tech stocks at the moment.
On the date of publication, Chris MacDonald has a LONG position in META. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.