Multiple reports speculating Meta’s (META) imminent departure from the metaverse could have been premature, according to the Financial Times. META has been in discussions with Magic Leap, a well-funded start-up, to create an agreement that would help Meta build AR (augmented reality) items.
The multi-year agreement could see Magic Leap provide licensing and manufacturing to Meta. Magic Leap creates AR devices for enterprises, manufacturing components such as lenses and software.
Meta has continued to invest heavily in metaverse projects, even while laying off around 20,000 employees. Zuckerberg has termed 2023 a “year of efficiency,” so it seems that an investment into Magic Leap’s technology would fit into his efficiency plans. This could especially hold true as Apple (AAPL) has announced plans to reveal its own AR headset, and competition between the tech mammoths will be heating up.
Is Meta a Good Buy?
According to Wall Street analysts, META stock remains a Strong Buy. 31 of the analysts rated as “Top Analysts” by TipRanks have given Meta a Buy rating, while only 4 Top Analysts have given it a Hold. Just last week, META gained after Loop Capital analyst Rob Sanderson rated Meta a Buy, noting that its stock price had nearly doubled, year-to-date. It will be interesting to see whether this new agreement, if it pans out, will send the stock even higher.