Meta Platforms stock target cut to $725 by TD Cowen

On Friday, TD Cowen analysts adjusted their outlook on Meta Platforms Inc. (NASDAQ: NASDAQ:META), lowering the price target to $725 from $785 while sustaining a Buy rating on the stock. The revision reflects a cautious stance in light of macroeconomic concerns that could potentially impact the company’s performance in the second quarter and beyond. The stock has experienced a significant 7.8% decline over the past week, with current trading at $516.34. According to InvestingPro analysis, Meta maintains strong financial health with more cash than debt on its balance sheet.

The analysts anticipate a strong first quarter for Meta, with total revenue expected to be near the upper end of management’s guidance and advertising revenue projected to increase approximately 17% year-over-year, excluding foreign exchange impacts. Additionally, they foresee improving profit margins during this period. Meta’s impressive 81.7% gross profit margin and recent revenue growth of 21.9% support this optimistic outlook. Investors should note that Meta’s next earnings report is scheduled for April 23, 2025. InvestingPro subscribers have access to 12 additional key insights about Meta’s financial performance and valuation metrics.

Despite the positive outlook for the initial quarter, TD Cowen has revised its estimates for the second to fourth quarters of 2025, as well as its long-term forecasts. This revision is attributed to a combination of softening consumer sentiment and potential impacts from tariffs. Nonetheless, the analysts remain optimistic about Meta’s advertising revenue growth, expecting around 14% year-over-year growth, excluding foreign exchange considerations, in 2025. This confidence is supported by increasing video engagement and the introduction of new advertising products under the Adv+ brand.

The new price target of $725, down from the previous $785, is maintained alongside a Buy rating, indicating that TD Cowen continues to see value in Meta Platforms’ stock despite the revised estimates. The analysts’ commentary underscores their expectation of solid first-quarter results while acknowledging the need to adjust projections due to broader economic factors.

In other recent news, Meta Platforms is actively pursuing a settlement to avoid an antitrust trial concerning its acquisitions of WhatsApp and Instagram. The trial, initiated by the Federal Trade Commission, could force Meta to reverse these acquisitions. Meanwhile, BofA Securities reaffirmed its Buy rating on Meta, maintaining a price target of $765. This comes as Meta plans to launch a new line of smart glasses, Hypernova, by year-end. The glasses are expected to feature advanced technology, including AI integration and a neural wristband controller.

Additionally, Meta has entered a multi-year partnership with the Ultimate Fighting Championship (UFC), becoming the official fan technology partner. This collaboration will see Meta’s branding in UFC events and the integration of its platform, Threads, as the official social media partner. The partnership aims to enhance fan experiences through innovative technology and exclusive content. These developments highlight Meta’s ongoing efforts to expand its technological offerings and strategic partnerships.

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