After the Facebook parent company announced its first dividend and posted strong profits, Meta increased its market value by over $200 billion on Friday, setting the stage for its largest percentage gain in a single day in a year.

Meta announced its quarterly dividend of 50 cents per share and authorized an additional $50 billion in share repurchases only days before Facebook turned 20.

The stock of Meta surged by up to 21.7 percent.

Based on LSEG data, the social media behemoth is the fourth stock in the "Magnificent Seven" and the first of its generation of internet behemoths to pay a dividend. Its yield of 0.5 percent is comparable to Apple's.

"The returning of cash to shareholders is a bold and well-regarded move. The amount of free cash pumping through the business means it is more than able to afford it, and it helps pay investors for their patience," Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown, said.

With around 350 million Meta Class A and Class B shares, CEO Mark Zuckerberg will receive a significant payout as a result of the dividend proposal. The co-founder of Facebook might receive almost $175 million each quarter.

The company reported 25 percent rise in revenue for the fourth quarter, with robust ad revenues and a comeback in user growth. Additionally, it exceeded analyst forecasts for current-quarter revenue in its outlook.

Having cut almost 21,000 workers since late 2022, Meta's quarterly sales increased by 100 percent, and the company was able to treble its net profits to $14.02 billion.

"The 'Year of Efficiency' has paid off, with both headcount and costs dropping, and Meta exceeding our expectations for full-year 2023 ad revenue," Jasmine Enberg, principal analyst at Insider Intelligence, said.

Over the past 10 years, the largest social media company in the world has been investing billions of dollars to increase its processing power for generative AI products that it is integrating into hardware like its Ray-Ban smart glasses and into Facebook, Instagram, and WhatsApp.

Recently, Meta's stock was trading at 21 times projected earnings, while smaller social media competitor Snap's forward PE was 84, Alphabet's was 20, Amazon.com's was 41, Microsoft was 32, and Apple was 27.36.