Investment banking firm Loop Capital maintained its bullish stance on Meta platforms with a target price of $888.
This indicates a 38% upside from Thursday’s closing price.
AI performance
Loop Capital’s analysts said that Facebook’s parent company’s artificial intelligence-driven performance has made up for the drop in spending from Chinese advertisers.
“We continue to see Meta as the best non-hardware example of tangible, right-now beneficiary of AI and think the stock will outperform the ‘mag-7’ peer group this year,” Loop Capital Analyst Rob Sanderson said.
The analyst said the stock will be a beneficiary of non-hardware example of being a beneficiary of AI.
The company increased its capital expenditure outlook for 2025 to invest more in data centres for AI. Meta plans to invest $72 billion in capital expenditure this year.
While the analyst noted that current core AI investments are constrained by capacity, new data centre AI capacity is coming online.
A behemoth concern
This positive note comes after a Wall Street Journal report said that Meta is delaying the rollout of its “Behemoth” large language model.
The Behemoth model was first slated to come out in April 2025 but was later pushed to June and now to fall or later, the report said.
According to the report, Meta’s engineers were concerned that Behemoth’s performance couldn’t match what the company’s public statements.
Meta had touted that Behemoth outperformed similar AI models of OpenAI, Google and Anthropic in some tests.
After the report came, Meta’s stock fell over 2% on Thursday.
FTC monopoly case
Meta recently asked a federal judge to drop the U.S. Federal Trade Commission’s (FTC) case against the company.
The company argued that the FTC failed to prove the antitrust case.
FTC had accused Meta of dominating the social media market by buying out rival companies such as Instagram and WhatsApp to buy out the competition.
The trial started in April, and the FTC is trying to show Meta was trying to buy out the competition a decade ago by pointing out emails of Meta CEO Mark Zuckerberg worrying about Instagram and WhatsApp’s growth.
If the judge doesn’t drop the case, the trial may run into June as Meta is now presenting its own evidence against the charges.
Meta stock continues to shine
Meta stock has gained over 7% in the year so far, emerging as the second-best-performing stock among the magnificent seven cohort of stocks in that period.
Microsoft is the best performing stock with a 8% gain and Apple has been the worst performing among the group with a 13% decline.
Meta’s shares had gained over 28% in the last month as investors cheered strong Q1 results.
The company had posted a 16% increase in revenue to $42.31 billion against an expected $41.40 billion.
Its net income surged 35% to $16.64 billion.
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