To The Moon

$Meta Platforms, Inc.(META)$ will be releasing their earnings report on 07/26/2023 after market close.

This week, investors will focus on the Federal Reserve meeting and earnings from tech giants -- Microsoft, Meta Platforms and Alphabet.

I would be looking at how Meta has spend the money on Threads app. There were a very good sign up during the initial phase, but have this trend continue?

I think we need to draw from Meta past project and implementation, they have spend significant amount of money on Metaverse. Same thing was very promising during the initial phase, but what happen at the end, the project was either closed down or shelved aside.

Thread app when done properly could boost Meta ads revenue so initial capital expenditure could be seen as a long term investment. But I hope this project would continue and not burn money (which could mean job cuts).

In this article, I will be looking at Meta’s fundamental data and technical analysis to see how it has actually be doing.

Meta Platform (META) Earnings Data

I believe analysts would be predicting how much advertisements revenue would Threads, Meta Platform's new app take from Twitter.

Some advertisers have look at Threads as less contentious and more predictable compared to Twitter. But to take away the marketing budgets, I believe not in the near term.

Hence, I would look out for Meta earnings from its various advertisements stream. The EPS might be beaten but by a small margins.

Meta Platform (META) Earnings History

EPS could be better than forecast but what is the plan on the ROI for Threads app? I would look at the guidance on Meta plan to really monetize it or rather the plan.

Meta Platform (META) Year-To-Date Earnings

No doubt Meta have a more than 100% growth return but will this be eventually reduce due to some of the ongoing projects?

For now, Meta looks pretty strong to be on the upside.

Meta Platform (META) Financial Overview

Something we need to take note of is the revenue, profit and eventually cash flow. We understand that there is a write off for the Metaverse projects during the last quarter earnings.

Will Meta revenue be able to catch up the loss? Or how long would be expected before we can see the free cash flow go back to Dec 22 level?

Meta Platform (META) Sentiment Analysis

Investors have been positive on Meta stocks and future. Investors have been increasing their holdings by 0.3% (last 7 days) and 1.7% (last 30 days).

This show that we can expect more buying of Meta shares in days leading up to its earnings release date on 26 Jul 2023.

Technical Analysis – Simple Moving Averages (SMA)

Meta have been enjoying a bull trend for almost 100 trading days, and it looks to be getting strong on an upward trend.

But I would be more interested on what Meta has in its plan to continue this bullish trend or even go higher than current.

Technical Analysis – Relative Strength Index (RSI)

Meta is currently on a good momentum on RSI and we can see that it is moving towards the oversold region.

This would suggest that there might be some buying prior to its earnings release on 26 Jul 23.

Technical Analysis – Average Directional Index (ADX)

ADX is above 40 which indicate a strong trend but +DI above -DI by a very small margin which suggest that this strong trend does not have a good strength.

We might see very small price movement for Meta leading up to its earnings release.

Technical Analysis – Parabolic SAR (SAR)

Something we might want to take note is SAR has show that Meta might have a potential bearish reversal. This might happen if there is any not so positive factors on its earnings report.

I would continue to monitor and hold any trade plan until 26 Jul 23.

Summary

Based on the fundamental analysis, Meta has a strong YTD growth but their free cash flow might be a concern if they are going to embark on any new project initiatives.

Technical Analysis has given a rather conflicting view, though we can see that price movement on SMA is gearing towards a bull trend.

It might be important for us to take note that there might be a potential bearish reversal. This could be triggered by events before the earnings release or the earnings release itself.

I will monitor and see how it will trade on 26 Jul after hour and 27 Jul premarket to see market reaction.

Appreciate if you could share your thoughts in the comment section whether you think Alphabet would post a slightly better or worse earnings?

@TigerStars @Daily_Discussion @TigerWire appreciate if you could feature this article so that fellow tiger would benefit from my investing and trading thoughts.

Disclaimer: The analysis and result presented does not recommend or suggest any investing in the said stock. This is purely for Analysis.