Meta Platforms Inc (NASDAQ: META) is in focus this morning after the tech behemoth agreed to a $725 million settlement over a privacy lawsuit.
Brief overview of the said lawsuit
The class action lawsuit claimed Facebook – its flagship social network illegally shared user data with Cambridge Analytica, the research firm linked to Donald Trump’s election campaign.
Roughly 87 million users were affected that eventually prompted a lawsuit in 2018. In a statement to CNBC, a Meta Platforms spokesperson said:
We pursued a settlement as it’s in the best interest of our community and shareholders. Over the last three years, we revamped our approach to privacy and implemented a comprehensive privacy programme.
The settlement comes at a time when the multinational is wrestling with a list of headwinds that slit its profit in half (year-on-year) in its recent reported quarter (source). Still, Evercore’s Mark Mahaney remains convinced that the Meta stock is a great pick for 2023.
Meta stock could gain 45% in 2023
Last month, Meta Platforms said it plans on lowering its headcount by 13% to cut costs in the midst of a challenging macroeconomic environment (read more).
Then just days ago, Andrew Bosworth – its Chief Technology Officer said the tech giant won’t spend more than 20% on its “metaverse” push. That commitment to managing costs, as per Mahaney, could see its shares return to $170 in 2023.
I get the sense that they’re more cost conscious, and that’s a good thing for investors.
Bank of America analysts also dub the Meta stock their “top recession stock” for the coming year.
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