Meta's stock, after a significant two-year rally, is facing new challenges due to its upcoming content moderation changes, transitioning from third-party fact-checking to a user-led community approach. Analysts suggest this shift could elevate the dissemination of misinformation and draw regulatory scrutiny, contributing to user disengagement and reduced advertising revenue. Following a recent downturn after hitting record highs, these risks add uncertainty to Meta's future performance and valuation, with analysts estimating a fair value of $770 per share, indicating current undervaluation.
Meta's shift from third-party fact-checking to a community notes approach could expose the platform to greater risks associated with misinformation and regulatory scrutiny.
The new content moderation policy, due to launch on March 18, is expected to profoundly affect the nature of content shared on Meta's platforms, potentially increasing the spread of false information.
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