Barclays Lowers Meta Price Target to $780
Barclays analyst Ross Sandler lowered the price target on Meta Platforms Inc.
(NASDAQ: META) to $780 (from $830) while maintaining an Overweight rating.
“META revenue came 1% above consensus, but OI missed on legal charges, and the company guided 3Q ahead.
The overall vibe on the call is very optimistic with new business opportunities across consumer and enterprise cropping up left and right, seemingly just around the corner.
Like Google, everything META is doing is around one common theme — infusing AI across consumer and small business enterprise products to scale up the revenue.
New AI revenue probably starts to drip in by end of ’26, which may be a bit disappointing to some investors, and then likely gush a bit more in ’27.
META is experiencing the same timing mismatch between capex and revenue witnessed across the space.
Right now we estimate META is monetizing at near $0/GW, well below the hyperscaler peers at $15B+ and AI lab peers closer to $50B+/GW.
Stepping back from the print, at 18x ’28 with a lot of potential upside about to enter the model, we like the risk/reward.
META’s ads business continues to defy gravity, growing 26% ex-fx in 2Q (10 points above Google) and gaining more dollar share on the field.
The 3Q guidance suggests much of the ad momentum continues into 2H despite the tough comps. Reversing the prior quarter’s age verification downtick, DAPs returned to sequential growth.
Between WhatsApp business messaging, new APIs, the new AI subscription and token pricing, and WhatsApp status ads, the promise of a new super-app is taking form and may start to move the needle on META revenue.
Noted above, the call sounded very broad while the reality is likely more narrowly focused to what exists in the four mega apps at META, but the strategy and business model expansion seemed almost peanut-butter-manifesto-esque.
There are already well-resourced and established competitors in many of these new enterprise AI areas.
We’d guess most of these new AI products leverage the existing META distribution rails, much in the same way Reels and Stories evolved out of Feeds, and generate high returns.”
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