(News Bulletin 247) – Meta gains nearly 9% in New York, while UBS reiterated on Wednesday its buy recommendation and its price target of 235 dollars on the stock which still remains its ‘preferred value’ (top pick ).
The broker points out that the 10,000 job cuts announced yesterday, combined with the freezing of 5,000 hirings, should allow the technology group to save eight billion dollars a year.
According to UBS, additional cost reductions are currently being considered, which means that the owner of Facebook and Instagram could well add $2.43 per share to its earnings per share (EPS) by 2024.
Assuming that Meta manages to regain its momentum in 2021, the broker estimates that the company could even generate more than $18 billion in additional turnover by then.
‘We believe that this story of cost reductions is likely to be followed by the potential the group has in terms of turnover, which implies an upward revision of market forecasts and an expansion of valuation multiples’ , he concludes.
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