Meta (META) Stock Forecast & Price Target

Meta Platforms demonstrates a solid financial performance with advertising revenues reaching $46.8 billion, representing a year-over-year increase of approximately 21% and exceeding consensus estimates by 3%. The company's return on capital has shown significant improvement, rising from 25.90% to 32.69% over the last twelve months, while economic profit surged by 67.69%, increasing from $30.72 billion to $51.52 billion. Additionally, with net sales revenue for the 12 months ending December 2024 projected to rise to $164.50 billion, and further anticipated growth to $194.78 billion, Meta's robust user engagement and increased daily active users signal a positive outlook for the company's financial trajectory.

The negative outlook on Meta Platforms's stock primarily stems from concerns regarding its ability to maintain profitability amid high capital expenditure and depreciation levels, which may impede future profitability despite the company's significant investment in AI. Additionally, the guidance for revenue in the upcoming quarter is 3% below consensus expectations, signaling potential growth deceleration and raising doubts about monetization capabilities from its AI investments. Furthermore, numerous risks, including the end of the cost-cutting era and challenges in competing with cloud providers for AI monetization, further contribute to skepticism about Meta's long-term financial health.