META Stock Inches Down Premarket: $9 Trillion Market Cap Goal, Social Media Addiction Verdict Weigh On Sentiment

• Meta linked top management incentives to the company achieving a $9 trillion market capitalization by 2031, a target many see as very aggressive.
• Meta lost a jury trial alleging negligence in creating platforms that harm kids.
• Stocktwits sentiment for META remained ‘neutral.’

Meta Platforms’ shares ticked lower in early premarket trading on Thursday, with a series of developments, including a new executive compensation plan, weighing on the shares.

The social media giant unveiled a financial incentive plan for top management that ties payouts to the company achieving a $9 trillion market capitalization by 2031, about six times its current level, underscoring that the company aims to grow at an aggressive pace.

Meta’s program – which bears resemblance to Tesla’s plan that set CEO Elon Musk’s eventual pay of up to $1 trillion – covers CTO Andrew Bosworth, Chief Product Officer Chris Cox, COO Javier Olivan, CFO Officer Susan Li, Chief Legal Officer C.J. Mahoney and Vice Chairman Dina Powell McCormick. It does not include the founder and CEO, Mark Zuckerberg.

“As with all stock options, there is only value if the share price meaningfully exceeds the exercise price, and in this case, it must be on an exceedingly aggressive 5-year timeline,” a company spokesperson said in their comments to the Wall Street Journal.

Meta shares declined 0.6% in Thursday’s premarket session; they are down nearly 10% year-to-date.

Meta Deemed Liable In Social Media Addiction Trial

In other news, a Los Angeles jury on Wednesday decided that Instagram’s owner Meta, and Google’s YouTube were negligent for operating a product that harmed kids and teens and failed to warn about those dangers.

In the landmark case that could potentially spur a flood of litigation against social media companies, the jury ordered the companies to pay $3 million to the plaintiff, a 20-year-old named Kaley G.M.

Retail, Analyst View On Meta

On Stocktwits, the retail sentiment for META remained in the ‘neutral’ territory, unchanged from the previous day. Still, several traders see limited downside from the legal headwinds and potential for strong gains in the near- to medium-term.

“META I’ll buy some calls tomorrow this is priced so low right now. It will definitely run up into earnings,” said a user. “$3 million. Zuck keeps that in his back pocket,” another said, referring to the paltry settlement sum vis-a-vis Meta’s financial strength. 

On Wall Street, 51 out of 67 analysts rate META ‘Buy’ or higher, and six rate it ‘Hold,’ per Koyfin. Their average price target of $863.63 implies a 45% upside to the stock’s last close.

For updates and corrections, email newsroom[at]stocktwits[dot]com.

Read Next: MSFT Stock Heads For Worst Quarter Since 2008 Crisis: Retail, Wall Street Still See Long-Term Upside