Bullish indicating open at $55-$60, IPO prices at $37
Investing.com - JPMorgan raised its price target on Meta Platforms Inc. (NASDAQ:META) to $875 from $795 on Thursday, while maintaining an Overweight rating on the stock. The social media giant, now valued at $1.94 trillion, has impressed analysts with its robust financial health, earning a "GREAT" rating on InvestingPro’s comprehensive assessment framework.
The price target increase follows Meta’s second-quarter results, which JPMorgan described as "very strong," with revenue growth accelerating to 22% year-over-year. The company maintains impressive gross profit margins of 81.77% and has demonstrated solid revenue growth of 19.37% over the last twelve months. The firm attributed this growth primarily to AI-driven engagement increases and advertising improvements.
Meta’s third-quarter guidance also impressed the investment bank, with the high end of the company’s outlook suggesting further acceleration in revenue growth compared to the second quarter.
JPMorgan noted that Meta "continues to earn the right to spend more on capex with strong core advertising performance," highlighting the relationship between the company’s revenue growth and its infrastructure investments.
The firm’s analyst emphasized that Meta’s "outsized revenue growth continues to support outsized infrastructure investments," reinforcing JPMorgan’s positive outlook on the social media giant’s business model and growth trajectory. While trading above InvestingPro’s Fair Value, Meta boasts strong fundamentals with 10 analysts recently revising earnings estimates upward. Discover 13 additional exclusive ProTips and comprehensive analysis in the Pro Research Report, available with an InvestingPro subscription.
In other recent news, Meta Platforms reported second-quarter results that surpassed Wall Street expectations, with revenue and earnings per share exceeding consensus estimates by 6% and 21%, respectively. The company also provided third-quarter revenue guidance that was ahead of analyst projections. Following these strong earnings, several firms adjusted their outlook on Meta. Stifel raised its price target for Meta to $900, maintaining a Buy rating, while Cantor Fitzgerald increased its target to $920, citing strong earnings and ad revenue growth. Rosenblatt also raised its price target to $1,086, noting the pivotal nature of Meta’s results. Additionally, HSBC upgraded Meta from Hold to Buy, supported by higher operational forecasts. Meanwhile, CoreWeave benefited from increased capital expenditure plans by Meta and Microsoft (NASDAQ:MSFT), signaling strong demand for AI infrastructure. Microsoft announced plans to spend over $30 billion in the current quarter, marking a significant increase from the previous year.
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