Meta stock price target raised to $775 from $665 at Oppenheimer

Oppenheimer maintained its Outperform rating on Meta Platforms Inc. (NASDAQ:META) Monday while raising its price target to $775.00 from $665.00, citing an improved advertising environment. The social media giant, now valued at $1.72 trillion, has demonstrated impressive financial strength with an 81.77% gross profit margin and maintains a "GREAT" financial health score according to InvestingPro analysis.

The research firm increased its revenue estimates for fiscal years 2025 and 2026 by 4% and 1% respectively, reflecting 17% and 15% growth excluding foreign exchange effects. These projections imply market share gains of 102 and 63 basis points, based on expected industry digital growth rates of 10% and 12%. Meta’s current revenue growth of 19.37% and return on equity of 40% support these ambitious projections. For deeper insights into Meta’s growth metrics and 12+ additional exclusive ProTips, consider exploring InvestingPro.

Oppenheimer identified TikTok’s first-quarter performance as a potential near-term risk for Meta, assuming no ban occurs. The firm also highlighted longer-term concerns about Meta potentially falling behind in AI model development, noting that Llama 4 was "perceived as disappointment" alongside Meta’s subsequent $14.3 billion investment and acquisition of Scale AI.

The research firm now forecasts Meta’s capital expenditures at $68 billion for 2025 and $85 billion for 2026. Earnings per share estimates were adjusted to $25.41 for 2025 and $28.23 for 2026, representing year-over-year growth of 6% and 11%.

The new $775 price target is based on a multiple of 27.5 times 2026 estimated earnings per share, which represents a 3% discount to peers despite Meta’s earnings per share growing 39% slower from 2024 to 2027, as "investors believe META unlock new business with AI." Currently trading at a P/E ratio of 25.95, InvestingPro’s comprehensive analysis suggests the stock is slightly overvalued at current levels, though its strong financial metrics and growth potential continue to attract investor attention.

In other recent news, Meta Platforms has agreed to acquire a 49% stake in Scale AI for $14.8 billion. This significant investment will see Scale AI’s CEO, Alexandr Wang, transition to Meta to lead a new superintelligence unit, while Jason Droege will step up as Scale AI’s CEO. OpenAI plans to maintain its collaboration with Scale AI, emphasizing the importance of working with multiple vendors for data sourcing. Additionally, Meta has filed a lawsuit against Joy Timeline HK Limited, the company behind the Crushai nudify apps, as part of its efforts to combat unauthorized AI-generated content. The company is also developing technology to detect and address advertisements for such apps. Meanwhile, Reddit has experienced a decline in user growth for the third consecutive month, with a 6 million drop in users primarily due to a decrease in feed ad units. Despite this, Piper Sandler reports that the overall digital advertising market is strengthening. Furthermore, Piper Sandler notes improvements in Pinterest (NYSE:PINS)’s advertising offerings and highlights Meta’s lower cost-per-clicks and cost-per-engagements, which are favorable for higher cost-per-thousand impressions.

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