Meta Platforms Stock Dropped 11% – Have You Assessed the Risk
Meta Platforms (META) stock is down 11.3% in a day. The stock looks fairly priced at the moment, though history suggests you may benefit from buying dips. Consider the following data:
- Size: Meta Platforms is a $1.7 Tril company with $189 Bil in revenue currently trading at $666.47.
- Fundamentals: Last 12 month revenue growth of 21.3% and operating margin of 43.2%.
- Liquidity: Has Debt to Equity ratio of 0.03 and Cash to Assets ratio of 0.15
- Valuation: Meta Platforms stock is currently trading at P/E multiple of 28.7 and P/EBIT multiple of 19.7
- Has returned (median) 74.5% within a year following sharp dips since 2010. See META Dip Buy Analysis.
While we like to buy dips if the fundamentals check out – for META, see Buy or Sell META Stock – we are wary of falling knives. Specifically, it is worth trying to answer if things get really bad, and META drops another 20-30% to $467 levels, will we be able to hold on to the stock? What is the worst case scenario? We call it downturn resilience. Turns out, the stock has fared worse than the S&P 500 index during various economic downturns. We assess this based on both (a) how much the stock fell and, (b) how quickly it recovered.
A single stock can be risky, but there is a huge value to a broader, diversified approach we take with the Trefis High Quality Portfolio. That is one way to look at stocks. The Trefis High Quality Portfolio evaluates much more, and is designed to reduce stock-specific risk while giving upside exposure.
Below are the details, but before that, as a quick background: META provides products that enable people to connect and share via devices, including mobile, PC, VR headsets, wearables, and augmented reality, fostering connection anytime and anywhere.
2022 Inflation Shock
- META stock fell 76.7% from a high of $382.18 on 7 September 2021 to $88.91 on 3 November 2022 vs. a peak-to-trough decline of 25.4% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 19 January 2024
- Since then, the stock increased to a high of $790.00 on 12 August 2025 , and currently trades at $666.47
| META | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -76.7% | -25.4% |
| Time to Full Recovery | 442 days | 464 days |
2020 Covid Pandemic
- META stock fell 34.6% from a high of $223.23 on 29 January 2020 to $146.01 on 16 March 2020 vs. a peak-to-trough decline of 33.9% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 20 May 2020
| META | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -34.6% | -33.9% |
| Time to Full Recovery | 65 days | 148 days |
2018 Correction
- META stock fell 43.0% from a high of $217.50 on 25 July 2018 to $124.06 on 24 December 2018 vs. a peak-to-trough decline of 19.8% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 9 January 2020
| META | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -43.0% | -19.8% |
| Time to Full Recovery | 381 days | 120 days |
It is a good thing to keep in mind how low META could go during a downturn. And you should also check how the stock fared when compared with the Trefis High Quality (HQ) Portfolio, with a collection of 30 stocks, has a track record of comfortably outperforming its benchmark that includes all 3 — the S&P 500, S&P mid-cap, and Russell 2000 indices. 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.