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Meta Platforms, Snap Will Be Metaverse Winners, Goldman Says

Meta Platforms has 'leading scale within the digital advertising industry and market-leading innovation,' Goldman analysts say in a new research report.
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Goldman Sachs thinks the metaverse hype is for real, and sees Meta Platforms, parent company of Facebook  (FB) - Get Meta Platforms Inc. Class A Report, Snap  (SNAP) - Get Snap, Inc. Class A Report and video game platform Roblox  (RBLX) - Get Roblox Corp. Class A Report as beneficiaries.

It rates all three stocks as buys.

“The global Internet is in the middle to late innings of the innovation curve of Web 2.0 (the shift from desktop to mobile computing and from local to cloud storage),” wrote Goldman analysts led by Eric Sheridan.

“The leaders of this wave of the Internet are now firmly established. In framing the next wave of computing (Web 3.0), we see the potential for dramatic shifts in industry structure (decentralized, more local/niche/targeted).”

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As for the metaverse, “the gaming/media landscape has already shown some key elements as to how [it] might evolve and how themes such as decentralized web activity and virtual experiences could become hallmarks of many of the next wave of computing in Web 3.0,” the analysts said.

Meta Platforms has “leading scale within the digital advertising industry and market-leading innovation with regard to longer-dated augmented reality/virtual reality and metaverse initiatives,” they said.

Meanwhile, “Snap is at the forefront (and an emerging industry leader) with respect to the rise of augmented reality, as management has prioritized investments in the development and adoption of AR technologies/use cases,” the analysts said.

And Roblox benefits from “its leading video games, user-generated content (UGC) platform,” they wrote. “With over 50 million daily active users and over 200 million monthly active users, RBLX is among the most popular game platforms in the world.”