Meta Platforms Inc (FB.O) stock soared 17% in a relief rally on Thursday, after losing almost half of its value this year, as the social media giant stunned Wall Street with a higher-than-expected increase in new users.
In premarket trade, the stock helped raise the tech-heavy Nasdaq, boosting many internet and technology stocks. Apple, Amazon, and Alphabet all saw their stock prices rise by more than 2%.
"Investors appear to be hungry for good news, and Meta's earnings falling within a whisker of forecasts tickled that itch," Laura Hoy, equities analyst at Hargreaves Lansdown, said.
"We don't believe the main FB business has changed significantly over the previous 90 days," J.P Morgan's lead analyst Doug Anmuth said in a note, "but challenges related to iOS modifications, TikTok competition, and Reels monetization are better recognized."
Analysts appeared to have differing opinions on the outcomes. At least five brokerages have lowered their price targets for the company, while three have upped theirs.
Only two analysts have a "sell" or worse rating on the company, out of the 63 analysts that cover it. The stock's consensus price objective is $300, which is much higher than its current trading price of $200.
The number of daily active users (DAU) on Facebook, a vital indicator for marketers, came in at 1.96 billion, slightly higher than the 1.95 billion forecast.
While this was enough to send the stock skyrocketing, Wall Street analysts were more cautious, citing concerns about the Ukraine conflict, Apple's App Store policy changes, and competition from ByteDance's TikTok.