Meta Platforms: Threads Is Growing the Fastest, but Impact on Meta’s Fair Value Likely Not Material

We are maintaining our $278 fair value estimate of Meta. While we commend the firm's timing of Threads, a social media app like Twitter, and are impressed with how quickly the app attained more than 100 million users, uncertainties regarding user retention in the long run and the monetization of Threads remain. If Meta applies its other apps’ advertising model while users stay and new ones join, then the likelihood of a two-sided network effect moat source, similar to Facebook and Instagram apps, increases, which could attract advertisers to the app. This could increase Meta’s fair value estimate by around 3%-6%.