Meta Platforms stock got a pair of price target hikes from analysts Thursday ahead of the Facebook parent's fourth-quarter earnings results due next week.
Wedbush analysts reiterated an outperform rating for Meta stock and raised their Meta price target from 680 to 700. Lead analyst Scott Devitt cited "positive momentum into 2025" for the social media giant. Meanwhile, BofA Global Securities analysts reiterated a buy call for Meta and upped their price objective to 710, from 660.
"Meta stock rose 65% in 2024, outperforming broader indices and Alphabet (up 35%) driven by revenue upside, strong cost discipline, and optimism on AI capabilities," BofA analyst Justin Post wrote to clients.
"With a stable macro backdrop, a growing AI contribution to ad revenues, ramping messaging revenues, and continued cost discipline (recent headcount cuts), we remain positive on the stock in 2025."
On the stock market today, Meta stock is up a fraction at 627.66 in morning trades.
Meta Q4 Preview: Focus On CapEx
Meta will report its Q4 results late Wednesday, Jan. 29. On average, analysts expect Meta's earnings will increase 27% to $6.75 per share, according to FactSet. Consensus estimates project Meta's revenue will increase 17% year over year to $46.98 billion.
Wedbush's Devitt wrote Thursday that advertiser feedback about the December-ended quarter indicates a "more modest deceleration" for Meta's year-over-year revenue growth than initially thought. Meta's revenue grew 19% year over year in the third quarter.
But Meta's fourth quarter results may take a backseat to what the company tells investors about its plans for the coming year.
"Investor focus has shifted towards 2025 expense/capital expenditure requirements," Devitt wrote. "The cost debate has now shifted to 2025, and alongside 4Q results, Meta will share expense/capex guidance for the year."
Meta has hiked its capital expenditures to invest in data centers that can power the company's AI ambitions.
Investors are expecting Meta to guide for 2025 capital expenditures of about $51.4 billion, according to Devitt. That would mark a 31% increase from the roughly $39 billion Meta is projected to have spent in 2024.
Devitt noted that consensus 2025 capex estimates from Meta analysts have increased 9% since Meta's third quarter results in October and 42% from a year ago.
"While we anticipate future estimate revisions for 2025 will be less material as capital requirements to support AI investments are better understood, any surprise regarding 2025 expense/capex guidance provided alongside 4Q results could impact shares," Devitt wrote.
TikTok Impact For Meta?
President Donald Trump used an executive order to delay enforcement of the TikTok ban for 75 days earlier this week. But analysts are making sense of what the loss of a major competitor could mean for Meta stock.
BofA's Post said there is still uncertainty about Trump's executive order and the president's stated desire for a joint-venture where a U.S. company owns 50% of TikTok. The possibility for a ban still looms over TikTok.
"At the very least, TikTok is subject to some ad sales disruption if there is a change in ownership of the company," Post said. "In case of any disruption to TikTok operations in the U.S., we see usage and ad spend shift benefit for Meta."
Meta Stock In Flat Base
Meanwhile, Meta stock bounced up from its 50-day line in trading last week and has pushed higher so far this week. Shares are approaching a 638.40 flat base buy point, according to MarketSurge.
Further, Meta is an IBD Leaderboard stock.
The social media stock has a best-possible IBD Composite Rating of 99, according to IBD Stock Checkup. The score combines five separate proprietary ratings into one rating. The best growth stocks have a Composite Rating of 90 or better.
