Meta's Reels is where it's at, Morgan Stanley says
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Forget TikTok. Metaâs (NASDAQ:META) Reels is where it's at, according to Morgan Stanley. 
Reels continues to gain adoption with its Reels product, a positive signal for engagement and monetization in 2024, analysts led by Brian Nowak wrote in an October 16 note.
According to a survey of 2,000 Americans aged 16 and up, Morgan Stanley found 79% of Instagram users are now using Reels, up from 74% in May, and 36% are on Reels daily versus 34% in May. 
Facebook Reels adoption also continues to trend upwards. Sixty-nine percent of Facebook users are now engaging with Reels compared to 65% in May, while 30% use Facebook Reels daily, up from 27% in May.
The analysts added that the engagement growth in Reels could result in "high-teens" revenue growth for the company in 2024, resulting in roughly $20 in earnings per share.
Meta (META) created Reels three years ago on the heels of the feverish frenzy over ByteDanceâs (BDNCE) TikTok social media app that filled the time amid stay-at-home mandates to curb the spread of the coronavirus. 
TikTok has more than 1B monthly active users, compared to 2.9B on Facebook, 2.2B a piece on YouTube and Instagram and 300M on X, formerly known as Twitter, according to Wallaroo Media, a marketing company.
Morgan Stanley, which has an Overweight rating on Meta (META), said there has been incremental ad scaling for Reels according to conversations with advertisers. 
Shares of Meta (META) are up 158% year-to-date.
The Wall Street firm is also feeling good about Pinterest (PINS) and Snap (SNAP) with increasing numbers of usage. 
Pinterestâs (PINS) e-commerce activity is at 24% of users purchasing products, up 190 basis points compared to May and up 770 basis points since March 2022. 
About 64% of Snapchat (SNAP) users are using Spotlight, up from 60% in May. 
The companies still need to improve their data capture, targeting, ad tools and performance-based ad offerings, Morgan Stanley said. It has an Equal-Weight rating on Pinterest (PINS). 

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