Meta Platforms slips as HSBC downgrades, citing competition, uncertainty
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Meta Platforms (NASDAQ:META) shares slipped around 1.5% in premarket trading on Friday as investment firm HSBC downgraded the tech giant, citing upcoming risks, including increased competition.
Analyst Nicolas Cote-Colisson lowered the firm's rating on Meta (META) to reduce from hold, but left the per-share price target at $110, noting that the potential for economic weakness in the global economy, along with increased competition and regulation are threats to the company in the near-term. 
Cote-Colisson also pointed out that GDP growth is expected to decline 1.4% in 2024, which impacts "almost all" of the company's revenue and all of its profits as they are directly related to the digital advertising market.
"Comments on the investor call reassured on the progress made on short-form video with Reels (growing engagement), but we still see strong competition â including TikTok â and under-monetization vs. Facebook continuing throughout 2023," Cote-Colisson wrote in a note to clients.
Senator Michael Bennet recently sent a letter to Apple (AAPL) CEO Tim Cook and Google (GOOG) (GOOGL) CEO Sundar Pichai asking them to ban TikTok from their respective app stores.
Earlier this week, Meta (META) reported fourth-quarter results that caused a sharp jump in the stock, due in part to continued progress with its Reels product.
Cote-Colisson also pointed out that regulatory risks are high for Meta (META), even as the company received a victory this week when a federal judge ruled the company can buy virtual reality company Within Unlimited.
Despite the issues in the near-term, Cote-Colisson sees the potential for the metaverse to provide considerable upside in the long-term, given the company's early move in the space.
In addition to reporting quarterly results and guidance this week, Meta (META) also unveiled a $40B buyback program to signal support in its stock.
Analysts are largely bullish on Meta Platforms (META). It has a BUY rating from Seeking Alpha authors, while Wall Street analysts rate it a BUY. Conversely, Seeking Alpha's quant system, which consistently beats the market, rates META a HOLD.