Meta Platforms (NASDAQ:FB), previously known as Facebook, looked like it would continue in an uptrend forever. FB stock broke down below key moving averages in September. The company then posted quarterly results in October and renamed or rebranded itself next.

The new name ended the selling pressure. Besides finding support at its 200-day simple moving averages, what does Meta Platforms need to do to resume its up-trend?

AR/VR Almost a Catalyst for FB Stock

Nearly a decade ago, the technology sector tried to turn augmented reality (AR) and virtual reality (VR) into a fad. Microsoft (NASDAQ:MSFT) developed Hololens back then. After it canceled its Windows Phone operating system and nurtured its software growth, Microsoft reportedly delayed its VR headset development. With Meta betting everything on VR, Microsoft will need to look at the market again.

Nvidia’s (NASDAQ:NVDA) continued investments in graphic processors on servers position Meta to harness its power. Morgan Stanley thinks the AR/VR market will be worth $100 billion in 2030 and then to $500 billion by 2040. Since it already has a loyal user base on Facebook, Instagram, and WhatsApp, Meta’s platform is the perfect zone for developing the metaverse. It is especially compelling for companies to embrace the space.

The Covid-19 pandemic has ebbs and flows. Instead of planning a full return to the office, corporations are finding they need to adopt a hybrid work model. The metaverse could supply virtual office spaces. People could work from home while using online tools that are not available from video meeting platforms.

Zoom’s (NASDAQ:ZM) meeting tool is limited. It offers only face-to-face communication and screen sharing. Meta’s metaverse could have sharable virtual apps.

Current Opportunity

Meta is many years from building its virtual offering. In the near term, the company needs to wait out the damage caused by a whistleblower. For example, Frances Haugen said that Instagram may never be safe for pre-teens and is harmful to people. Meta responded to the Haugen accusation. It said, “It is not accurate that leaked internal research demonstrates Instagram is ‘toxic’ for teen girls. The research actually demonstrated that many teens we heard from feel that using Instagram helps them when they are struggling with the kinds of hard moments and issues teenagers have always faced.”

The company cannot add more to the response. Just as it had to wait for the boycott to play out, it needs to wait for the public backlash on the whistleblower’s revelations to subside.

Advertisers cannot abandon the Facebook or Instagram platform. Both sites are too big to avoid.

According to Stock Rover, Meta stock scores well on growth. The company has a strong history of reporting revenue growth from advertising. Its quality score reflects good return on investment.

The value score of 75/100 is fair. After shares rose in 2021, investors are getting less value.

Risks

Whenever media attention on Facebook intensifies, the company has a way of rebounding from it. The public often calls on the government to regulate Meta. Although regulations are a risk, it is unlikely to hurt its business. Besides, Facebook has an independent oversight board that handles special cases.

In the third quarter, Meta said it had almost 3.6 billion people who are actively on one or more of its services. Chief Executive Officer Mark Zuckerberg acknowledged the revenue headwinds related to the Apple (NASDAQ:AAPL) privacy chances. Furthermore, Apple’s iMessage is growing in popularity.

Meta is helping businesses to embrace Apple’s changes. It is encouraging them to use Facebook solutions that work inside its app. Businesses will set a shop on the Facebook platform to increase customer acquisition rates. In the holiday season, Meta will work with some of the businesses to help them identify new customers. If their business grows, Meta will scale those solutions more broadly in 2022.

Fair Value

29 out of 35 analysts rate FB stock as a buy with a price target that ranges between $300 and $466 (per Tipranks).

The quarterly slowdown related to Apple’s changes is temporary. Macro headwinds, such as the supply chain disruption and Covid resurgence in Southeast Asia, are also temporary issues. In the next few quarters, Instagram Reels has growth momentum. Once the site rolls out ads on Instagram, revenue growth will re-accelerate. Meta is currently in the early phases of monetizing Facebook Reels.

Facebook and Instagram will manage Apple’s iOS changes systematically. Its advertising tools will have fewer user data points to work on. It will aggregate and anonymize more data, which will enable it to deliver relevant, personalized ads to users.

Your Takeaway on FB Stock

Facebook revived its brand with the new Meta name. Sentiment will swing to the positive as its advertisers continue allocating big budgets on the platform. The company overcame many obstacles before, like boycotts and site outages. Users will keep using its platform despite the rising competition in messaging apps.

FB shares remain a good long-term hold for investors.

On the date of publication, Chris Lau did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Chris Lau is a contributing author for InvestorPlace.com and numerous other financial sites. Chris has over 20 years of investing experience in the stock market and runs the Do-It-Yourself Value Investing Marketplace on Seeking Alpha. He shares his stock picks so readers get original insight that helps improve investment returns.