Meta stock price target raised to $812 from $683 at UBS on AI potential

Investing.com - UBS raised its price target on Meta Platforms Inc. (NASDAQ:META) to $812 from $683 on Thursday, while maintaining a Buy rating on the stock. The social media giant, currently trading at $708.68 with a market capitalization of $1.78 trillion, has demonstrated impressive revenue growth of 19.37% over the last twelve months.

The price target increase comes as part of a broader UBS report examining whether AI demand will justify current investment levels across the economy. UBS specifically highlighted Meta’s long-term opportunity to generate additional revenue from various AI products. According to InvestingPro data, Meta maintains excellent financial health with an overall score of "GREAT" and industry-leading gross profit margins of 81.77%.

UBS pointed to two particular AI initiatives CEO Mark Zuckerberg emphasized during Meta’s first-quarter 2025 report: Business Messaging and Meta AI. The firm noted that while Meta’s capital expenditures and most operational expenses for AI development are already reflected in forecasts, the potential revenue from these initiatives is not yet incorporated into UBS or Wall Street models.

The investment bank expressed confidence that Meta faces less risk from potentially slower-than-anticipated enterprise AI spending since the company primarily uses its own technology. This positioning helps insulate Meta from what UBS described as a potential "capacity-demand digestion phase" in the broader AI market.

Recent developments in Meta’s AI strategy include its investment in Scale AI and increased recruitment of AI talent, factors that UBS acknowledged in its analysis while maintaining its Buy recommendation on the stock. With the next earnings report scheduled for July 23, 2025, investors will be closely watching Meta’s progress in monetizing these AI initiatives.

In other recent news, Meta Platforms Inc. has been actively expanding its artificial intelligence capabilities through strategic investments and recruitment efforts. The company recently finalized a $14.3 billion investment for a 49% stake in data-labeling company Scale AI, marking a significant move in its AI strategy. This investment has led OpenAI to phase out its work with Scale AI, as Meta’s involvement introduces new dynamics in the data-labeling landscape. Additionally, Meta has been in discussions about potential acquisitions, including talks with AI startups Runway AI and Perplexity AI, although these discussions did not result in formal offers.

Meta’s recruitment strategy has also been aggressive, with offers of up to $100 million in signing bonuses to attract talent from competitors like OpenAI. Despite these efforts, OpenAI CEO Sam Altman noted that none of their top talent has accepted Meta’s offers. In another development, Cantor Fitzgerald raised its price target for Meta to $807, maintaining an Overweight rating. This adjustment follows Meta’s announcement of new advertising formats on WhatsApp, which could potentially drive growth in the coming years. Meta continues to focus on building its AI capabilities, reflecting its commitment to advancing in the competitive tech landscape.

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