Only Meta Platforms Inc. has outperformed the S&P 500 and Nasdaq 100 indices in 2025 because it is “less leveraged,” as compared to the other ‘Magnificent 7’ stocks, explains an analyst.
While Meta, led by Mark Zuckerberg, continues to be an investor favorite, it is also undervalued as compared to its peers.
What Happened: The high interest rate environment in 2025 has kept the technology mega caps under pressure, according to John Murillo, the chief dealing officer at B2BROKER.
“Many tech companies, especially those with high leverage, are particularly susceptible to changes in interest rates,” said Murillo, adding that the Federal Reserve's current stance has been impacting these companies' profitability and valuations.
He also highlights that the current U.S. administration's tariff policies, particularly targeting China, have created uncertainties in global trade, risking increasing costs for tech companies and affecting their earnings.
Thus, investors have grown increasingly skeptical about the high-tech index’s performance in 2025 due to a weaker guidance amid high interest rates and an inflationary push from Donald Trump's tariff policy, according to Murillo.
“Currently investors favor less leveraged tech stocks like Meta, bearing in mind that loan paybacks can significantly eat into their net profits,” he said.
See Also: Rigetti Asserts ‘Leadership’ In Quantum Computing Race, Aims To Scale To 100 Qubits As It Looks To Catch Up With IBM, Google
Why It Matters: Meta is up 4.41% on a year-to-date basis, whereas the exchange-traded fund tracking S&P 500 index, SPDR S&P 500 ETF Trust (NYSE:SPY) was down 1.49%. Also, Invesco QQQ Trust, Series 1 (NASDAQ:QQQ), tracking the Nasdaq 100 declined 3.61% in the same period.
According to Benzinga Pro data, Meta’s long term debt stood at $28.826 billion but it has a debt-to-equity ratio of 0.269, implying its strength to service its debts.
| Stocks | Long Term Debt | Debt-To-Equity Ratio | YTD Performance |
| Nvidia Corporation (NASDAQ:NVDA) | $8.463 Billion | 0.129 | -18.52% |
| Apple Inc. (NASDAQ:AAPL) | $83.956 Billion | 1.45 | -1.96% |
| Microsoft Corp. (NASDAQ:MSFT) | $39.722 Billion | 0.206 | -6.04% |
| Amazon.com Inc. (NASDAQ:AMZN) | $52.623 Billion | 0.458 | -9.52% |
| Alphabet Inc. (NASDAQ:GOOGL) (NASDAQ:GOOG) | $10.833 Billion | 0.078 | -7.81% |
| Meta Platforms Inc. (NASDAQ:META) | $28.826 Billion | 0.269 | 4.41% |
| Tesla Inc. (NASDAQ:TSLA) | $5.535 Billion | 2.025 | -30.75% |
Elon Musk‘s Tesla, on the other hand, has underperformed the most in 2025, falling 30.75% since the start of the year.
Price Action: Meta closed 0.36% lower at $625.66 on Friday. Over the last one year, the stock rose by 29.38%.
Benzinga tracks 43 analysts with an average price target of $731.76 for the stock, reflecting a "buy" rating. Estimates range widely from $575 to $935. Recent ratings from Tigress Financial, UBS, and Citigroup average at $833.67, suggesting a potential 35.34% upside.
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