3 Metaverse Merchants

The world of immersive technology is undergoing seismic change as new innovations rapidly alter the digital realms in which we inhabit. One of them is the emergence of the metaverse, presented by Big Tech as the future of the Internet.

Considered the next best thing in tech, the Metaverse is a colossal community cyberspace built at the intersection of virtual reality and augmented reality. It’s an immersive world where millions of users, or their avatars, can enter and exit a plethora of activities as they socialize, work, and play.

The following three companies are betting heavily on the Metaverse as they pour billions into technology designed to bring the physical and virtual realms closer than ever. While the concept has yet to reach the ubiquity of the internet, the following metaverse providers represent compelling propositions for investors looking to play a megatrend early on.

Facebook Inc Class A

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FB

Current yield:

P / E forward:

24.63

Price

$ 375.09

Just value:

407 USD

Value

Quite valued

Pit

Large

Moat trend

Stable

Star rating

***

Data as of September 02, 2021

The world’s largest online social network, Facebook (FB) has 2.5 billion monthly active users who engage with each other by exchanging messages and sharing current events, photos and videos. The company’s various brands include the Facebook app, Instagram, Messenger, WhatsApp and a host of services built around these products.

Facebook generates more than 90% of advertising revenue, of which 50% comes from the United States and Canada and 25% from Europe.

Facebook CEO Mark Zuckerberg is a strong supporter of the metaverse and has publicly spoken of pushing further into the digital realm. “It’s a virtual environment where you can be present with people in digital spaces. You can kind of think of it as an embodied Internet that you are in rather than just watching,” Zuckerberg said of the Metaverse recently. when calling for profits from Facebook. .

Over the years, Facebook has invested heavily to create its version of the Metaverse, calling it the next chapter of the business. “In the years to come, I expect people to go from seeing us primarily as a social media company to a metaverse company,” Zuckerberg said on the call.

Robust growth in users and user engagement, the valuable data they generate and the continued growth of online advertising “bodes well for Facebook as the company generates strong revenue growth. business and remaining positive and profitable cash flow, ”said Morningstar equity analyst. Ali Mogharabi, who recently raised the fair value of the share from US $ 390 to US $ 407.

Microsoft Corp

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MSFT

Current yield:

0.74%

P / E forward:

33.90

Price

US $ 301.1

Just value:

$ 325

Value

Quite valued

Pit

Large

Moat trend

Stable

Star rating

***

Data as of September 02, 2021

Technology juggernaut Microsoft (MSFT) develops and licenses consumer and enterprise software. Best known for its Windows operating systems and Office productivity suite, the company also offers smart cloud (Azure, Windows Server operating system) and personal computers (Windows client, Xbox, Bing search, and laptops and computers. Surface).

Microsoft recently revealed its intention to become a dominant player in the professional metaverse. CEO Satya Nadella shared the company’s vision for an “enterprise metaverse” during a speech at Microsoft Inspire earlier this year.

“With our metaverse stack, you can start with the digital twin to create a rich digital model of anything physical or logical, be it assets, products, or complex environments spanning people, places, things and their interactions, ”Nadella said.

Microsoft’s enterprise metaverse combines IoT, digital twins, and mixed reality to capture more of the enterprise software market.

“Microsoft Enterprise Services (MES) should be able to maintain its position in the market by being part of the world’s largest software company,” said Dan Romanoff, Morningstar equity analyst.

Shifting from on-premises to cloud and / or hybrid environments remains a complex task, he adds, noting that “given the company’s position as a leader in both traditional (Windows Server products) and SQL) and cloud (Azure), we believe customers will continue to engage with Microsoft for professional services.

Driven by strong revenue growth, Romanoff recently increased the share’s fair value from US $ 278 to US $ 325, noting that “we continue to see an advantage for this high quality name from here”.

The Walt Disney Company

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SAY

Current yield:

P / E forward:

36.76

Price

US $ 181.97

Just value:

170 USD

Value

Quite valued

Pit

Large

Moat trend

Stable

Star rating

***

Data as of September 02, 2021

A heavyweight in global entertainment, Walt Disney (DIS) boasts popular characters such as Mickey Mouse and Luke Skywalker, featured in several Disney theme parks around the world. The company also makes films at Pixar, Marvel and Lucasfilm movie studios and owns popular TV channels and TV production studios. Disney recently entered the booming streaming market with its own OTT ESPN + offerings and the Disney + service.

“We believe that Disney is successfully transforming its business to cope with the continuing evolution of the media industry,” the Morningstar Stock Report says, adding that its direct-to-consumer streaming services are becoming the main “drivers of long-term growth as the business transitions to a streaming future.

Walt Disney CTO Tilak Mandadi has publicly shared Disney’s long-term vision of building a Disneyland-themed metaverse. “As we look to the future, connected park experiences that transcend the physical and digital barrier and open up new layers of storytelling are a very exciting goal for us,” he said at IAAPA’s one of the biggest annual events in the theme park industry last year. “I call this concept the ‘theme park metaverse’ – this is where the physical and digital worlds converge, with wearable devices, smartphones and digital hotspots immersing guests in the experiences of the metaverse.

Mandadi revealed that the House of the Mouse strives “to bring more of these experiences to our customers in the months and years to come – in our parks, in our hotels, on our cruise ships and in the homes of our guests. clients “.

The recent rebound in earnings and strong growth in subscribers led Morningstar equity analyst Neil Macker to increase the share’s fair value from US $ 154 to US $ 170.


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