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Investing.com - Goldman Sachs has lowered its price target on Meta Platforms Inc. (NASDAQ:META) to $815 from $870 while maintaining a Buy rating following the company’s third-quarter earnings report. Currently trading at $751.67, Meta remains near its 52-week high of $796.25 and shows a favorable PEG ratio of 0.62, according to InvestingPro data, suggesting the stock may still be reasonably valued despite its impressive 37.11% price return over the past six months.
The adjustment comes after Meta delivered what Goldman Sachs described as a "mixed quarter," featuring strong core business operations that exceeded forecasts alongside a continued elevated investment cycle that is expected to impact future stock performance.
Meta’s Family of Apps segment showed solid results with healthy user growth and monetization improvements, positioning the company for sustained above-industry advertising growth in the medium term, barring any macroeconomic downturn. With impressive gross profit margins of 81.97% and revenue growth of 19.37% in the last twelve months, Meta continues to demonstrate strong fundamentals.
Management raised the bottom end of its guidance ranges for both 2025 total GAAP expenses and capital expenditures, while introducing updated language about "significantly faster" expense growth and "meaningfully larger" capital expenditure growth for 2026.
Goldman Sachs expects this capital expenditure investment cycle to continue for at least the next 12-24 months, with GAAP expenses potentially remaining elevated longer due to rising depreciation, stock-based compensation, and leasing expenses for technical infrastructure.
In other recent news, Meta Platforms Inc. reported its Q3 2025 earnings, showcasing a mixed financial performance. The company announced earnings per share (EPS) of $1.05, which fell significantly short of the anticipated $6.68, marking an EPS surprise of -84.28%. However, Meta’s revenue was a bright spot, reaching $51.2 billion and surpassing the forecasted $49.36 billion, representing a 26% increase compared to the previous year. This revenue growth highlights Meta’s ability to generate substantial income despite the EPS shortfall. These developments come as analysts continue to scrutinize the company’s financial health and market position. The earnings results have prompted discussions among investors and analysts about Meta’s future strategies.
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