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Meta Platforms (NASDAQ: META) stock has fallen 16% since the company's Q3 results were reported on October 29. This decline was primarily driven by two factors that concerned investors: a one-time $15.93 billion tax charge and the announcement of higher-than-expected capital expenditures for its AI initiatives. Despite the recent sell-off, we believe META stock warrants a place on your watchlist. Here is the technical rationale: Trading in a Key Support Zone: The stock is currently trading within a historical support zone of $600.17 to $663.35. Historical Performance: Over the past 10 years, this price range has acted as a strong catalyst, attracting significant buying interest on three separate occasions. Potential for Rebound: Following these previous bounces, the stock went on to generate an average peak return of 18.9%. But is the price action sufficient on its own? It certainly benefits if the fundamentals are sound. For META Read Buy or Sell META Stock to ascertain how compelling this buying opportunity may be. Clients are fond of their preferred stocks, but reliance on a single stock can erode years of gains. Savvy financial advisors achieve intelligent diversification – find out how our Boston-based wealth management partner can assist. Here are some quick data points for Meta Platforms that should facilitate decision-making: Revenue Growth: 21.3% LTM and 17.3% average over the last 3 years. Cash Generation: Nearly 23.7% free cash flow margin and 43.2% operating margin LTM. Recent Revenue Shocks: The minimum annual revenue growth for META over the last 3 years was 0.9%. Valuation: META stock trades at a PE multiple of 27.2 For a quick overview, Meta Platforms offers products that enable individuals to connect and share through a variety of devices, including mobile, PC, VR headsets, wearables, and augmented reality, facilitating connection at any time and from anywhere. MORE FOR YOU What Is Stock-Specific Risk If The Market Crashes? Meta is no stranger to significant declines. It dropped around 43% during the 2018 correction, nearly 35% during the Covid pandemic, and suffered its largest loss with a 77% crash during the inflation shock. Even with solid fundamentals, these drops indicate that the stock can be severely impacted when market conditions change. A strong business doesn’t guarantee protection when fear takes hold. However, the risk is not confined to substantial market downturns. Stocks can decline even when markets are performing well – consider situations like earnings reports, business announcements, or changes in outlook. Read META Dip Buyer Analyses to understand how the stock has bounced back from sharp declines in the past.
