Assessing the Future: Meta Platforms vs. Apple Contemplating the Future: Meta Platforms vs. Apple

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By Ronald Tech

Meta Platforms’ (NASDAQ: META) stock has surged by approximately 180% in the last year, approaching its all-time high. Investors flocked back to the social media behemoth as its advertising division regained momentum. With an expanded share buyback authorization and the initiation of a dividend, Meta’s market cap ascended past the trillion-dollar milestone in January to reach $1.2 trillion. Yet, it still stands in the shadow of Apple (NASDAQ: AAPL), whose dominance in user privacy on the iOS platform has veiled Meta’s ad sales for several years.

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Despite these challenges, Meta’s resurgence raises the question: Can it outpace Apple’s current $2.8 trillion valuation by 2030?

Predicting Meta’s Potential by 2030

In 2022, Meta hit roadblocks due to TikTok’s rise, macroeconomic headwinds in advertising, and pressures from Apple’s privacy upgrades. However, a notable rebound in 2023 saw a 16% revenue increase and a 73% surge in earnings per share as the advertising business recovered. Meta leveraged in-house AI algorithms to gather more first-party data, expanded its Reels platform, and attracted new ad purchases from Chinese companies.

Analysts forecast a 14% compound annual growth rate for Meta’s revenue and a 22% rate for earnings from 2023 to 2026. The stock appears reasonably valued at 24 times forward earnings.

If Meta sustains a 15% growth trajectory from 2026 to 2030, its projected EPS of $46.70 could drive its stock price to around $1,120, yielding a market cap nearing $2.8 trillion.

Estimating Apple’s Worth by 2030

Apple confronted a growth deceleration over the past few years, facing challenges from the waning iPhone 12 sales surge in fiscal 2022 and a subsequent decline in fiscal 2023. Analysts foresee modest compound annual revenue and earnings growth rates of 4% and 8%, respectively, from fiscal 2023 to 2026.

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Despite its stable growth outlook, Apple trades at a premium due to its safe-haven image. To sustain its position, Apple must diversify away from its iPhone reliance by introducing new products and services.

If Apple maintains an 8% EPS growth rate from 2026 to 2030, achieving $10.50 per share, its market cap could reach $4.5 trillion. A potential contraction in its forward multiple to 20 could peg its value at $3.2 trillion.

Meta’s Growth Story

While Meta may not surpass Apple by 2030, it exhibits greater upside potential. For Meta to equal Apple’s current market cap by 2030, its stock must more than double from current levels.

Conversely, Apple might struggle to match Meta’s gains with single-digit earnings growth. Apple’s future success hinges on the success of devices like the Vision Pro and the company’s ability to reduce dependence on the iPhone.

Before investing in Meta Platforms, it is crucial to weigh the opportunities and risks against alternative options. The analysts at the Motley Fool Stock Advisor have identified promising stocks worth considering. Critical decisions today could yield substantial returns in the future.