Who could slow down Mark Zuckerberg’s costly plan to pivot Meta Platforms (META) into the metaverse? It’s going to have to be one of the investors holding the biggest losses.
And these investors have the most to lose from the company’s decision a year ago to shift from lucrative social media to nauseating virtual reality. They’ve watched as more than $211 billion in market value in their own current positions vanished this year. They’ve lost even more than Zuckerberg, who’s down $85 billion.
“Meta, which was already struggling to adapt to changes to Apple’s mobile ad-tracking policies, saw its advertising revenue fall about 4% year over year in the September quarter,” says a report from S&P Global Market Intelligence. “Meta is in the process of pivoting its core focus from social media toward the future metaverse, which is also not sitting well with investors.”
Meta Platforms (META)
100150Price35,700,000NovOctSep1804210723092612
The Meta Debacle
Meta investors are paying a big price for the company’s decision to shift its business roughly a year ago.
Just this year, shares of Meta are down more than 73% to 89.48. That’s shaved more than $650 billion off the company’s market value. Meta’s loss in market value is more than what 99% of the companies in the S&P 500 are individually worth. It also makes Meta the worst-performing stock in the S&P 500 this year.
And if you own mutual funds and ETFs, you’re holding a big part of the bag of losses, too. Meta, alone, is a 17% position in the Communication Services Select Sector SPDR (XLC), 12% holding in Vanguard Communication Services ETF (VOX) and 10% spot in iShares Global Communication Services ETF (IXP).
But will these ETF giants speak up?
Who’s Holding The Meta Bag?
Meta is somewhat unusual among S&P 500 companies in that the founder, Zuckerberg, is still a top shareholder with 347.8 million shares. But ETF giants as a group own even more than he does.
Vanguard is the stock’s No. 2 holder with 180.4 million shares. That accounts for more than 6.8% of the company. And due to that huge position size, Vanguard is down more than $44 billion on the stock this year.
Another ETF behemoth, BlackRock, is the No. 3 largest holder of Meta stock with 152 million shares valued at 5.7% of the company. BlackRock is down more than $37 billion this year on the stock. Rounding out the top 5 holders are other players in ETFs and mutual funds like American Funds’ parent Capital Research with a 4.5% position and Fidelity FMR at 4.2%.
Several co-founders, too, remain the top 10 like Eduardo Saverin with his 2% position and Dustin Moskovitz with just under 1%. But it’s going to be up to the big fund companies needed to speak up. Activist investors, so far, only own a tiny part of the company. New York State Common Retirement Fund only owns 0.18% and D.E. Shaw 0.13%
The question now is whether any activists will be lured in by Meta’s suddenly lower price?
Biggest Meta Losers
Top holders of Meta Platforms stock and their paper losses this year so far
| Holder | Value lost this year ($ billions) | % owned on shares outstanding |
|---|---|---|
| Mark Elliot Zuckerberg (Founder, Chairman & CEO) | $85.9 | 13.1% |
| Vanguard Group | 44.5 | 6.8 |
| BlackRock | 37.4 | 5.7 |
| Capital Research and Management | 29.8 | 4.6 |
| FMR | 27.7 | 4.2 |
| State Street Global Advisors | 22.2 | 3.4 |
| Eduardo Saverin (Co-Founder) | 13.2 | 2.0 |
| T. Rowe Price Group | 12.7 | 1.9 |
| Geode Capital Management | 10.5 | 1.6 |
| Norges Bank Investment Management | 6.9 | 1.1 |
| Dustin Moskovitz (Co-Founder) | 6.4 | 1.0 |
