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Investing.com -- In a note to clients on Tuesday, Bank of America reiterated its Buy rating on Meta Platforms (NASDAQ:META) with a $765 price target, citing strong early momentum in artificial intelligence and a strategic overhaul of the company’s AI division.
The move follows reports that the company has created a new Superintelligence Labs unit, led by Alexandr Wang, former CEO of ScaleAI, with Nat Friedman, former GitHub CEO, helping to oversee product development and research.
In an internal memo, CEO Mark Zuckerberg is said to have stated: “As the pace of AI progress accelerates, developing superintelligence is coming into sight. We believe this will be the beginning of a new era for humanity, and I am fully committed to doing what it takes for Meta to lead the way.”
BofA noted Meta’s “substantial investment in talent,” including 11 new hires from leading AI firms like OpenAI, Anthropic, and Google (NASDAQ:GOOGL). Reports of compensation packages exceeding $100 million suggest Meta is aggressively building a top-tier AI team.
Analysts said the restructuring reflects Meta’s intent to be both “an AI starting place for users” and a developer platform, leveraging its Llama language model and wide user base.
Meta’s AI applications like Andromeda and Advantage+ are said to already be improving ad performance, with monetization opportunities emerging in Threads, WhatsApp, and upcoming subscription models.
However, BofA warned that ramping up AI operations will drive higher operating costs.
Meta’s expenses are expected to rise 19% year over year to $113.6 billion in 2025, in line with guidance.
Even so, BofA believes there is “room for these costs in Street estimates,” adding that Meta remains an early AI beneficiary with clear monetization upside.