Global Courant
Investors can have more confidence in Meta Platform’s prospects, says Piper Sandler. Analyst Thomas Champion raised his price target on Facebook’s parent company on Wednesday, saying the social media company has strengthened Reels and built out its artificial intelligence strategy. He also noted that overweight Meta is still his top choice in digital advertising. “We are now more confident in META’s renewed acceleration and are increasing sales for 2H23 and off-year estimates. Our Ad Metrics data suggests pricing is weaker, but spending is holding up. stock ramping up faster than expected,” Champion wrote. META YTD mountain Meta shares YTD Meta shares have already doubled this year, up 125%, as the likelihood of a pause in rate hikes supports the outlook for mega-cap tech stocks. The analyst’s price target of $310, raised from $270, implies a 14% gain from Tuesday’s closing price of $271.32. Part of the driver behind the analyst’s bullish stance is recent growth in user time on Meta’s social media platforms, including rising impressions on Instagram Reels in the second quarter. Champion expects impressions, or the number of times a piece of content is viewed, to grow by about 30% year over year. Meanwhile, Meta’s AI strategy is helping to increase the time users spend on its platforms, improve its set of tools for advertisers, and build an AI ecosystem. “META is only now starting to gain market share after about 2 years of declines,” Champion wrote. “We think AI investments, new product growth (Reels), TikTok issues and adtech investments made the stock good for 2H23 and into ’24.” Piper Sandler wasn’t the only Wall Street firm to raise its price target on Meta. Wolfe Research also raised its price target from $300 to $330 on Tuesday, implying that Meta could rise 21% from Tuesday’s closing price. Analyst Deepak Mathivanan reiterated his outperform rating, saying the company’s generative AI plans “could potentially benefit revenue growth in the coming years.” —Michael Bloom of CNBC contributed to this report.
