Meta shares rise after Morgan Stanley raises rating of Facebook owner

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Meta shares rise after Morgan Stanley raises rating of Facebook owner

By Scott Kanowsky -- Shares in Facebook owner Meta Platforms (NASDAQ: META ) rose on Tuesday after Morgan Stanley upgraded its rating of the social media giant to overweight from equal weight, citing the company's ongoing drive to slash costs.

The raised recommendation comes after Meta announced that it would lay off another 10,000 workers as part of a expense reduction campaign that chief executive Mark Zuckerberg has dubbed the "Year of Efficiency." Around 5,000 open roles will also be closed.

It is the second round of major job cuts at Meta in the past six months. Last November, the company dismissed 11,000 employees, or about 13% of its total workforce.

The Morgan Stanley analysts said they believe that Zuckerberg's cost trimming will go on past 2023. They added that they believe it will presage a "structural and cultural pivot" to a leaner organization more focused on investor returns that can set an example for other tech giants like Amazon (NASDAQ: AMZN ) and Google parent Alphabet (NASDAQ: GOOGL ).

"So while we are turning bullish Meta on newly embraced structural discipline, we are also hopeful these actions serve as a broader signal to other tech companies to adopt more incremental discipline," the Morgan Stanley analysts wrote in a note to clients.

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