Meta’s Q4 Results Beat Expectations; Growth Likely to Return in the Second Half; FVE of $260 Stands

Meta reported better than expected fourth-quarter results despite currency headwinds, macro uncertainty, and deceleration in overall digital advertising growth. Meta also appears to have improved ad conversions on its apps and measurability, increasing demand from advertisers and lessening the impact of Apple’s moves. On the user front, the firm’s network effect remains intact, displayed by daily and monthly user growth. We are pleased with management’s effort to exert cost control while accelerating top-line growth. In addition, the firm’s continuing aggressive share buyback during the quarter and another buyback authorization support our Exemplary capital allocation rating.