By Meta Platforms Inc (NASDAQ: META) is in focus after the European Commission fined it a staggering €797.72 million ($840.24 million) over anti-competitive practices related to the Facebook Marketplace.
The tech titan has been abusing its dominance in the social media landscape to impose “unfair trading conditions on other online classified ads services providers,” the Commission said in a statement today.
Meta plans on appealing the decision – but a company representative confirmed that it will also work with the regulator to devise a solution that addresses its concerns.
Meta stock is down less than 1.0% following the EU news on Thursday.
Why does it matter for Meta stock?
The EU fine is unlikely to be significant for Meta Platforms stock price.
Its Commission has a history of penalizing tech behemoths like Google and Apple Inc. Even Meta itself is not new to be hit with fines from the European Union. South Korea also fined it $15.67 million for unauthorized data collection last week.
But seldom have such punitive actions resulted in a sustained overhang on their stock prices.
Meta shares are keeping resilient at writing also because the management plans on appealing the ruling. That’s significant since Alphabet Inc. had a €1.49 billion antitrust fine from the European Commission overturned by an EU court in September of 2024.
If Meta’s appeal lands a similar outcome, it won’t even have to pay the fine and, so, its investors have nothing to worry about.
Is this EU fine related to Trump’s victory?
Donald Trump is expected to hit the European Union with raised tariffs as the 47th President of the United States – and the bloc plans on responding with new taxes against American goods.
That makes one wonder if the sizable fine the Commission imposed on Meta Platforms today was an early show of its retaliation against the imminent Trump tariffs.
While it’s nothing more than speculation for now, what’s given is that the EU is warming up to a trade war – a part of which may be more frequent big-ticket fines against the US-based companies like Meta.
Meta stock price is currently up 70% versus the start of 2024.
Is Meta stock worth investing?
Any near-term weakness that may materialize in Meta shares on the back of this new fine from the European Commission may be a buying opportunity considering Wall Street currently has a consensus “overweight” rating on them.
Loop Capital recently raised its price target on this tech stock to $655 which indicates potential for a close to 15% upside from here.
Last month, Meta Platforms came in handily above Street estimates for its third quarter.
Loop expects the company’s financial performance together with its AI leadership to continue to serve as meaningful tailwinds for Meta stock in the coming months. Meta Platforms pays a modest dividend yield at writing as well.
The post EU fines Meta €800 million: is Trump’s election victory sparking trade tensions? appeared first on Invezz
