BofA Securities Reiterates Buy on Meta, $835 PT

BofA Securities analyst Justin Post reiterated a Buy rating and $835 price target on Meta Platforms Inc. (NASDAQ: META).

“Reports 7/29. Our checks suggest healthy 2Q ad growth. We are revising 2Q ests. to reflect stronger ad trends, partially offset by recent US$ depreciation.

We expect 2Q Rev/EPS of $60.6bn/$7.50 vs Street $60.2bn/$7.18 and think rev. expectations could be around $61bn.

With 10% workforce reduction in May & job postings down 49% q/q in 2Q, we expect EPS upside.

We think content retrieval & ad revenue benefits from Al Model Integration (see Silver Torch announcement), usage and opportunities for Muse Spark, and potential for external compute sales would be focus areas for 2Q call.

For 3Q’26, we est. Rev/EPS of $63.5bn/$7.22 vs Street at $63.0bn/$7.03.

Assuming 2Q near high end of the guide & noting a 3pt tougher ex-FX 3Q y/y comp., we expect 3Q outlook of $60.5-$63.5bn (flat to +5% q/q).

For expenses, we think Meta could lower high end by $1-2bn given substantial 2Q layoffs.

Given higher q/q memory costs, we see potential for Meta to update its capex guide to $135-$150bn (from $125-$145bn).

Following reports of a potential compute deal with Anthropic, we are adding $5bn in 2027 revenues for addtl.

AI capacity benefits (expect monetization via ads, subscriptions or enterprise sales). For 2027, we raise Rev by 1% to $316bn & EPS by 2% to $35.00.

For 2028 we raise revenue by $11bn for AI Capacity, somewhat offset by higher COGS & R&D. We also expect lower SBC expense in future years following recent layoffs.”

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