M&A: Meta's Four Critical Acquisitions
If you still think of Meta (NASDAQ:META) as 'just the Facebook company,' you're missing the real story - a story written in billion-dollar deals, aggressive digital land-grabs, and a playbook of strategic domination that would make even the most ruthless CEOs blush. Over the past decade, four critical acquisitions didn't just help Meta survive - they catapulted it into an empire.
Investors tend to be skeptical about acquisitions - but they aren't all bad, as Meta has shown. When done right, they have a purpose. They help expand, create moats, and in some cases, cripple the competition. Identifying such competitive advantages (or disadvantages) from acquisitions is one of the lenses we apply in High-Quality portfolio, which has outperformed the S&P 500 and achieved returns greater than 91% since inception.
Let's break down the four game-changers that made Meta the beast it is today.
Imagine buying a scrappy photo-sharing app with few million users and turning it into a massive business. That's exactly what Meta (then Facebook) did when it scooped up Instagram for what now looks like a "modest" $1 billion in 2012.
Fast forward to 2025 and Instagram's share of Meta's revenue could exceed 50% in 2025. Yes, you read that right! That would mean nearly $80-90 billion in revenue from Instagram ads. Assuming net margin of 30% (Meta overall has 35%+) and a modest PE multiple of 20x, Instagram alone is worth $500 billion. That's bigger than most S&P 500 cash rich giants!
$19 billion sounded insane at the time. But Meta wasn't buying WhatsApp for its revenues - it was buying scale, reach and relevance in every corner of the globe.
WhatsApp has nearly 3 billion monthly unique users. While it is far from Instagram-level monetization, WhatsApp is positioning itself as Meta's "super app" for payments, e-commerce, and business messaging. There are estimates of 'business messaging' itself having revenue potential of $30-$40 billion.
India is home to the largest WhatsApp user base of nearly 500 million. The government of India removed 100 million user cap for WhatsApp Pay at the end of 2024 - opening the digital payment market to more competition, which is currently dominated by Google Pay and PhonPe.
When Meta acquired Oculus VR in 2014, people thought Zuckerberg had lost his mind. (VR headsets? Really?) But Oculus wasn't just a tech toy - it was the first brick in Zuckerberg's ambitious vision for the "metaverse," a concept Meta has been pouring over $10 billion per year into developing.
Oculus, now rebranded as Meta Quest, dominates the consumer VR market - with over 70% unit market share globally. While still a small fraction of Meta's total revenue, the growth of the VR market is explosive. According to IDC, the global AR/VR headset unit sales could more than triple by 2028.
If Instagram was about photos, and WhatsApp about messages, CTRL-Labs was about the future of how we even interact with technology. Meta quietly picked up this brain-computer interface startup for a rumored $500 million to $1 billion, and it could end up being one of its most profound investments.
CTRL-Labs' technology is still in the experimental stage, but it's part of Meta's larger vision for the metaverse and augmented reality. Meta has integrated CTRL-Labs into its Reality Labs division, where it's exploring how brain-computer interfaces could revolutionize VR/AR interaction and eventually lead to neural-driven devices.
As Meta continues to invest in CTRL-Labs' neural interface technology, the integration of this system into VR headsets and AR glasses could redefine user interaction.
When people criticize Meta for its massive spending sprees, they miss the forest for the trees. These four deals - Instagram, WhatsApp, Oculus, and CTRL-Labs - aren't just acquisitions. They're foundations. Each one secured Meta's dominance in a critical arena: social media, global communications, virtual reality, and human-machine interaction.
Does it make you want to buy and hold on to Meta stock? Well that wouldn't be the worst idea. But here is the thing - going all-in in a single stock - no matter how good - is a recipe for disaster. Trefis High Quality (HQ) Portfolio is designed to diversify stock-specific while providing exposure to the upside. With a collection of 30 stocks, it has a track record of comfortably outperforming the S&P 500 over the last 4-year period. Why is that? As a group, HQ Portfolio stocks provided better returns with less risk versus the benchmark index; less of a roller-coaster ride as evident in HQ Portfolio performance metrics.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
28 minutes ago
- Yahoo
20 stocks primed for rapid growth while trading at half of Nvidia's valuation
When selecting investments, it is easy to get hung up on a particular metric, such as a dividend yield or a price ratio, but investors need to look deeper or they might miss opportunities. Inc. AMZN provides an example: Its stock has typically traded at a high price-to-earnings ratio. Investors tend to look at a stock's forward P/E ratio, which is the price divided by analysts' consensus estimate for earnings per share over the following 12 months. Over the past 10 years, Amazon's stock has traded at an average forward P/E of 79.5, while the S&P 500 SPX has traded at an average forward P/E of 18.7, according to FactSet. But Amazon's stock was up 855% for 10 years through Friday, while the S&P 500 returned 235% with dividends reinvested. My daughter's boyfriend, a guest in my home, offered to powerwash part of my house — then demanded money What on Earth is going on with the American consumer? My father-in-law has dementia and is moving in with us. Can we invoice him for a caregiver? 'The situation is extreme': I'm 65 and leaving my estate to only one grandchild. Can the others contest my will? 20 stocks primed for rapid growth while trading at half of Nvidia's valuation It turns out that for Amazon's management team, bottom-line earnings traditionally weren't a focus. The emphasis was on reinvesting most of the cash being generated to expand the business in multiple directions. So the Amazon story was about revenue growth, rather than EPS growth. And that brings us to Nvidia Corp. NVDA. Last week Laila Maidan looked into Nvidia's relatively high forward P/E and explained why the stock might still be considered a bargain for long-term investors, based on analysts' expectations for the company's revenue growth. Nvidia's stock traded at a forward P/E of 28.1 at Friday's close, while the S&P 500 traded at a weighted forward P/E of 21.4. It is not a surprise to see Nvidia trading at a P/E valuation that is 31% higher than that of the index. But based on consensus estimates among analysts polled by FactSet, Nvidia is expected to increase its sales per share at a compound annual growth rate of 41.7% through 2026, versus an expected sales-per-share CAGR of 5.5% for the S&P 500. All such estimates in this article are adjusted by FactSet to match calendar years; about 20% of companies in the S&P 500 have fiscal reporting periods that don't match the calendar. For Nvidia, investors pay a premium for the higher expected growth rate. And that sets the stage for a stock screen. Which companies trading at low P/E multiples are also expected to increase revenue quickly? For this screen we are looking at revenue growth projections — specifically sales per share. We are using the per-share numbers because they reflect expected dilution to a company's share count if it issues new shares to help fund an acquisition. Merging with a competitor will obviously make revenue increase. But if the share count rises significantly, sales per share will be lower. The per-share numbers help investors to understand whether or not a company might have overpaid for an acquisition. Starting with the S&P 500, we narrowed the list to companies trading at forward P/E ratios of 14 or less — half Nvidia's valuation. Actually, we rounded down, so the list was confined to stocks trading at a forward P/E of less than 14.5. Then we sorted the list by expected sales-per-share CAGR from calendar 2024 through 2026, based on consensus estimates among analysts polled by FactSet. Here are the 20 stocks in the S&P 500 with the highest expected sales-per-share CAGR through 2025 among those trading at a P/E of less than 14.5: Company Ticker Industry Forward P/E Expected sales-per-share CAGR from 2024 through 2026 Expand Energy Corp. EXE Integrated Oil 12.0 39.6% Super Micro Computer Inc. SMCI Computer Processing Hardware 14.1 31.9% EQT Corp. EQT Integrated Oil 13.6 26.0% Micron Technology Inc. MU Semiconductors 9.4 23.2% Coterra Energy Inc. CTRA Integrated Oil 8.3 21.2% First Solar Inc. FSLR Solar Power Equipment 8.7 20.5% Norwegian Cruise Line Holdings Ltd. NCLH Hotels/ Resorts/ Cruiselines 7.9 15.9% Incyte Corp. INCY Pharmaceuticals 10.7 15.5% Seagate Technology Holdings PLC STX Computer Peripherals 12.4 15.0% Gen Digital Inc. GEN Software 11.1 13.0% DaVita Inc. DVA Medical/ Nursing Services 11.6 12.0% Oneok Inc. OKE Oil & Gas Pipelines 14.2 11.8% Molina Healthcare Inc. MOH Managed Healthcare 11.7 11.8% Aptiv PLC APTV Electrical Products 9.0 10.9% UnitedHealth Group Inc. UNH Managed Healthcare 12.5 10.7% Elevance Health Inc. ELV Managed Healthcare 10.5 10.4% Dell Technologies Inc. Class C DELL Computer Processing Hardware 11.4 10.2% American International Group Inc. AIG Multi-Line Insurance 12.2 10.2% HCA Healthcare Inc. HCA Hospital/ Nursing Management 14.4 9.9% Ball Corp. BALL Containers/ Packaging 14.3 9.7% Source: FactSet You may need to scroll the table to see all of the data. It is a varied list. Super Micro Computer SMCI ranks second, with a 31.9% CAGR expected for sales per share through 2026. The stock soared last month after President Donald Trump announced investment agreements with Saudi Arabia to build data centers in the U.S., which lifted suppliers of related equipment. Read: Super Micro's stock keeps surging. Here's what might come next. It might surprise you to see UnitedHealth Group UNH on the list, in light of the company's numerous difficulties. These have included higher-than-expected costs in its Medicare Advantage business, reports of a government investigation into possible healthcare fraud and the departure of Chief Executive Andrew Witty. But with the stock having tumbled 40% this year through Friday, with dividends reinvested, analysts working for brokerage and research firms believe the worst is over, with 21 out of 29 analysts polled by FactSet rating UnitedHealth a buy or the equivalent. Only three of the analysts rate the stock a sell or the equivalent. Leaving the companies passing the screen in the same order, here is a summary of analysts' opinions about the stocks: Company Ticker Share buy ratings Share neutral ratings Share sell ratings May 30 price Consensus price target Implied 12-month upside potential Expand Energy Corp. EXE 90% 10% 0% $116.13 $128.45 11% Super Micro Computer Inc. SMCI 47% 41% 12% $40.02 $40.69 2% EQT Corp. EQT 72% 24% 4% $55.13 $60.63 10% Micron Technology Inc. MU 85% 12% 3% $94.46 $123.95 31% Coterra Energy Inc. CTRA 83% 17% 0% $24.31 $33.41 37% First Solar Inc. FSLR 78% 20% 2% $158.08 $202.43 28% Norwegian Cruise Line Holdings Ltd. NCLH 72% 28% 0% $17.65 $23.65 34% Incyte Corp. INCY 45% 52% 3% $65.06 $73.95 14% Seagate Technology Holdings PLC STX 59% 36% 5% $117.94 $119.88 2% Gen Digital Inc. GEN 45% 55% 0% $28.48 $31.83 12% DaVita Inc. DVA 9% 83% 8% $136.26 $167.14 23% ONEOK Inc. OKE 67% 33% 0% $80.84 $106.75 32% Molina Healthcare Inc. MOH 42% 47% 11% $305.04 $356.93 17% Aptiv PLC APTV 68% 23% 9% $66.81 $75.76 13% UnitedHealth Group Inc. UNH 73% 17% 10% $301.91 $376.05 25% Elevance Health Inc. ELV 75% 25% 0% $383.84 $491.94 28% Dell Technologies Inc. Class C DELL 81% 19% 0% $111.27 $136.52 23% American International Group Inc. AIG 55% 45% 0% $84.64 $90.88 7% HCA Healthcare Inc. HCA 59% 34% 7% $381.39 $387.95 2% Ball Corp. BALL 61% 33% 6% $53.58 $61.23 14% Source: FactSet Any stock screen has its limits and should only be used as a tool as part of your own research if you are selecting individual companies for investment. Click on the tickers for more about each company. Read: Tomi Kilgore's detailed guide to the information available on the MarketWatch quote page 'You never know what might happen': How do I make sure my son-in-law doesn't get his hands on my daughter's inheritance? Strategists forecast a sizzling summer for small-cap stocks 'I am getting very frustrated': My mother's adviser has not returned my calls. He manages $1 million. Is this normal? My life partner is 18 years my senior. He wants to leave his $4.5 million fortune to me — not his two kids. Do we tell them? 'I'm afraid to ask her': My stepmother won't show me my father's will. What now?
Yahoo
44 minutes ago
- Yahoo
'80s Pop Icon Joins Elite Club With ‘Monumental Achievement' of Classic Hit
'80s Pop Icon Joins Elite Club With 'Monumental Achievement' of Classic Hit originally appeared on Parade. No, you haven't been Rickrolled! 's iconic '80s classic song, 'Never Gonna Give You Up,' which inspired the social media pranking sensation, has joined some unique company. 🎬 SIGN UP for Parade's Daily newsletter to get the latest pop culture news & celebrity interviews delivered right to your inbox 🎬 Originally released in 1987, the song has joined Spotify's Billions Club in recognition of it passing more than one 1 billion streams on the platform. 'I never could have imagined back in 1987 that 'Never Gonna Give You Up' would still be going strong decades later,' Astley said in a statement. 'Thanks to streaming platforms, a whole new generation has been able to discover music like mine. Reaching one billion streams is something I never dreamed of and to everyone who's ever listened, thank you.' Astley also celebrated the achievement by posting a video commenting about the milestone on Instagram. Fans were quick to congratulate the singer in the comments, with one writing, 'Congratulations on the monumental achievement of your debut single, "Never Gonna Give You Up," reaching an astounding 1 billion streams on Spotify! 🎉✨🥳✨🎊 This is a testament to the timeless magic of your music and the enduring love fans worldwide have for this iconic track.' At the time of its initial release, 'Never Gonna Give You Up' also did quite well for itself, topping the singles chart in more than 20 different countries, including a five-week run on top of the U.K. charts and two weeks atop the Billboard Hot 100. It experienced a renaissance in 2020 thanks to the Rick-rolling social media prank, reaching platinum status in the U.K. that year and double-platinum there three years later. In the U.S. it has hit the five-time platinum isn't the only streaming platform where the song has exceeded 1 billion streams. It hit that mark on YouTube in 2022 and now has more than 1.6 billion there. Aside from winning the hearts of fans worldwide, Astley has also earned the endorsement of fellow stars, including Foo Fighters , who called Astley 'the most bad-ass mother—ker!' Foo Fighters have backed Astley on a live version of 'Never Gonna Give You Up,' while Astley covered the Foo's hit 'Everlong' live at Radio 2 in the Park in 2023. '80s Pop Icon Joins Elite Club With 'Monumental Achievement' of Classic Hit first appeared on Parade on Jun 2, 2025 This story was originally reported by Parade on Jun 2, 2025, where it first appeared.
Yahoo
an hour ago
- Yahoo
Leading Independent Proxy Advisory Firms Glass Lewis and ISS Recommend that Shareholders Vote 'FOR' the Proposed Merger Between PTMN and LRFC
NEW YORK, June 03, 2025 (GLOBE NEWSWIRE) -- Portman Ridge Finance Corporation (NASDAQ: PTMN) ('Portman Ridge' or 'PTMN') and Logan Ridge Finance Corporation (NASDAQ: LRFC) ('Logan Ridge' or 'LRFC') (together, the 'Companies') announced today that leading independent proxy advisory firms, Institutional Shareholder Services ('ISS') and Glass, Lewis & Co. ('Glass Lewis'), have both recommended that LRFC stockholders vote 'FOR' the proposed merger of LRFC with and into PTMN at the upcoming LRFC special meeting scheduled for June 6, 2025. In addition, ISS and Glass Lewis have both recommended that PTMN stockholders vote 'FOR' the proposals related to the proposed merger at the upcoming PTMN special meeting scheduled for June 6, 2025. In its May 30, 2025 report, Glass Lewis noted, 'We recognize the transaction would consolidate two entities that are managed by affiliated investment advisers, have overlapping portfolios of investments, and similar strategies and risks. The transaction aims at creating an entity with greater scale, a more diversified portfolio and anticipated greater market liquidity, among other benefits. Overall, we believe the entities have presented a reasonable strategic rationale for the proposed merger.' Similarly, in its report dated May 23, 2025, ISS commented, 'The strategic rationale appears sound, as the combined company will have increased scale, structural simplification, and more diversification. On balance, in light of the compelling strategic rationale, support for the proposed share issuance is warranted.' Ted Goldthorpe, President and Chief Executive Officer of PTMN and LRFC and Head of the BC Partners Credit Platform, stated, 'We're encouraged by the support from both ISS and Glass Lewis, which reflects their alignment with the LRFC and PTMN Boards' unanimous recommendations to their shareholders to vote in favor of the proposed merger. With PTMN standing as the surviving entity, we believe the combination will enhance PTMN's scale, increase trading liquidity, further increase portfolio diversification, and will generate meaningful earnings accretion for shareholders, all which pave the way for our future growth initiatives and strengthen our position as a leader in executing strategic growth transactions amongst publicly traded business development companies.' With special meetings scheduled for June 6, 2025, both PTMN and LRFC urge their stockholders to attend the meeting and cast their votes by following the instructions outlined in the joint proxy statement. Stockholders of PTMN can also access the virtual meeting and vote by going to the following website: or by calling 1-833-218-3911 and providing the control number which is listed in the proxy card received. Stockholders of LRFC can access the virtual meeting and vote by going to the following website: or by calling 1-833-218-3962 and providing the control number which is listed in the proxy card received. Shareholders can access the joint proxy statement and prospectus by clicking HERE. Shareholders who have questions about the joint proxy statement or about voting their shares should contact the companies' proxy solicitor, Broadridge, at 1-833-218-3911 for PTMN shareholders and 1-833-218-3962 for LRFC shareholders. About Portman Ridge Finance Corporation PTMN is a publicly traded, externally managed investment company that has elected to be regulated as a business development company (a 'BDC') under the 1940 Act. PTMN's middle market investment business originates, structures, finances and manages a portfolio of term loans, mezzanine investments and selected equity securities in middle market companies. PTMN's investment activities are managed by its investment adviser, Sierra Crest. PTMN's filings with the Securities and Exchange Commission (the 'SEC'), earnings releases, press releases and other financial, operational and governance information are available on Portman Ridge's website at About Logan Ridge Finance Corporation LRFC is a BDC that invests primarily in first lien loans and, to a lesser extent, second lien loans and equity securities issued by lower middle-market companies. LRFC invests in performing, well-established middle-market businesses that operate across a wide range of industries. It employs fundamental credit analysis, targeting investments in businesses with relatively low levels of cyclicality and operating risk. For more information, visit Cautionary Statement Regarding Forward-Looking Statements Some of the statements in this communication constitute forward-looking statements because they relate to future events, future performance or financial condition. The forward-looking statements may include statements as to future operating results of PTMN and LRFC, and distribution projections; business prospects of PTMN and LRFC, and the prospects of their portfolio companies; and the impact of the investments that PTMN and LRFC expect to make. In addition, words such as 'anticipate,' 'believe,' 'expect,' 'seek,' 'plan,' 'should,' 'estimate,' 'project' and 'intend' indicate forward-looking statements, although not all forward-looking statements include these words. The forward-looking statements contained in this communication involve risks and uncertainties. Certain factors could cause actual results and conditions to differ materially from those projected, including the uncertainties associated with (i) the ability of the parties to consummate the merger on the expected timeline, or at all; (ii) the expected synergies and savings associated with the merger; (iii) the ability to realize the anticipated benefits of the merger, including the expected elimination of certain expenses and costs due to the merger; (iv) the percentage of PTMN shareholders and LRFC shareholders voting in favor of the applicable Proposal (as defined below) submitted for their approval; (v) the possibility that competing offers or acquisition proposals will be made; (vi) the possibility that any or all of the various conditions to the consummation of the merger may not be satisfied or waived; (vii) risks related to diverting management's attention from ongoing business operations; (viii) the combined company's plans, expectations, objectives and intentions, as a result of the merger; (ix) any potential termination of the merger agreement; (x) the future operating results and net investment income projections of PTMN, LRFC or, following the closing of the merger, the combined company; (xi) the ability of Sierra Crest to implement its future plans with respect to the combined company; (xii) the ability of Sierra Crest and its affiliates to attract and retain highly talented professionals; (xiii) the business prospects of PTMN, LRFC or, following the closing of the merger, the combined company, and the prospects of their portfolio companies; (xiv) the impact of the investments that PTMN, LRFC or, following the closing of the merger, the combined company expect to make; (xv) the ability of the portfolio companies of PTMN, LRFC or, following the closing of the merger, the combined company to achieve their objectives; (xvi) the expected financings and investments and additional leverage that PTMN, LRFC or, following the closing of the merger, the combined company may seek to incur in the future; (xvii) the adequacy of the cash resources and working capital of PTMN, LRFC or, following the closing of the merger, the combined company; (xviii) the timing of cash flows, if any, from the operations of the portfolio companies of PTMN, LRFC or, following the closing of the merger, the combined company; (xix) the risk that stockholder litigation in connection with the merger may result in significant costs of defense and liability; and (xx) future changes in laws or regulations (including the interpretation of these laws and regulations by regulatory authorities). PTMN and LRFC have based the forward-looking statements included in this document on information available to them on the date hereof, and they assume no obligation to update any such forward-looking statements. Although PTMN and LRFC undertake no obligation to revise or update any forward-looking statements, whether as a result of new information, future events or otherwise, you are advised to consult any additional disclosures that they may make directly to you or through reports that PTMN and LRFC in the future may file with the SEC, including the Registration Statement and Joint Proxy Statement (in each case, as defined below), annual reports on Form 10-K, quarterly reports on Form 10-Q and current reports on Form 8-K. No Offer or Solicitation This communication is not, and under no circumstances is it to be construed as, a prospectus or an advertisement and the communication is not, and under no circumstances is it to be construed as, an offer to sell or a solicitation of an offer to purchase any securities in PTMN, LRFC or in any fund or other investment vehicle managed by BC Partners or any of its affiliates. Additional Information and Where to Find It This communication relates to the proposed merger of PTMN and LRFC and certain related matters (the 'Proposals'). In connection with the Proposals, PTMN has filed a registration statement (Registration No. 333-285230) with the SEC (the 'Registration Statement') that contains a combined joint proxy statement for PTMN and LRFC and a prospectus of PTMN (the 'Joint Proxy Statement') and has mailed the Joint Proxy Statement to its and LRFC's respective shareholders. The Registration Statement and Joint Proxy Statement will contain important information about PTMN, LRFC and the Proposals. This communication does not constitute an offer to sell or the solicitation of an offer to buy any securities or a solicitation of any vote or approval. No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of 1933, as amended. SHAREHOLDERS OF PTMN AND LRFC ARE URGED TO READ THE REGISTRATION STATEMENT, JOINT PROXY STATEMENT AND OTHER DOCUMENTS THAT ARE FILED OR WILL BE FILED WITH THE SEC, AS WELL AS ANY AMENDMENTS OR SUPPLEMENTS TO THESE DOCUMENTS, CAREFULLY AND IN THEIR ENTIRETY WHEN THEY BECOME AVAILABLE BECAUSE THEY WILL CONTAIN IMPORTANT INFORMATION ABOUT PTMN, LRFC AND THE PROPOSALS. Investors and security holders will be able to obtain the documents filed with the SEC free of charge at the SEC's website, or, for documents filed by PTMN, from PTMN's website at and, for documents filed by LRFC, from LRFC's website at Participants in the Solicitation PTMN, its directors, certain of its executive officers and certain employees and officers of Sierra Crest and its affiliates may be deemed to be participants in the solicitation of proxies in connection with the Proposals. Information about the directors and executive officers of PTMN is set forth in its proxy statement for its 2025 Annual Meeting of Stockholders, which was filed with the SEC on April 29, 2025. LRFC, its directors, certain of its executive officers and certain employees and officers of Mount Logan and its affiliates may be deemed to be participants in the solicitation of proxies in connection with the Proposals. Information about the directors and executive officers of LRFC is set forth in the Annual Report on Form 10-K/A, which was filed with the SEC on April 29, 2025. Information regarding the persons who may, under the rules of the SEC, be considered participants in the solicitation of the PTMN and LRFC shareholders in connection with the Proposals will be contained in the Registration Statement, including the Joint Proxy Statement included therein, and other relevant materials when such documents become available. These documents may be obtained free of charge from the sources indicated above. Contacts:Portman Ridge Finance Corporation650 Madison Avenue, 3rd floorNew York, NY 10022 Logan Ridge Finance Corporation650 Madison Avenue, 3rd floorNew York, NY 10022 Brandon SatorenChief Financial Officer (PTMN and LRFC) (212) 891-2880 The Equity Group Catilcati@ (212) 836-9611 Val Ferrarovferraro@ (212) 836-9633Error while retrieving data Sign in to access your portfolio Error while retrieving data Error while retrieving data Error while retrieving data Error while retrieving data
