- Shares in Facebook-owner rallied 18% since 16 January
- Analysts see Meta as one of markets biggest AI beneficiaries
- Zuckerberg talked up growth potential in recent Q4 earnings
Facebook-parent Meta Platforms (META:NASDAQ) closed higher overnight for the 17th straight session on 11 February, a run dating back to 16 January that has netted the stock an 18% gain.
Stock futures data suggest the run will continue when Wall Street reopens later today, indicating another 0.4% rise for the stock to $722.72, which would valule the business at $1,827 billion, or $1.83 trillion.
WHY HAS THE STOCK BEEN RISING?
Meta is spending a ton of money on AI and investors are convinced the company will be able to turn that investment into bottom line results. Founder and CEO Mark Zuckerberg announced in mid-January that the company plans to spend up to $65 billion on capex this year, calling 2025 ‘a defining year for AI.’
Meta’s fourth quarter earnings on 29 January reinforced the company’s strong results and AI game plan. In the quarter, the company posted impressive revenue growth of 21% to $48.39 billion and EPS (earnings per share) growth of 50% to $8.02.
WHAT DOES WALL STREET THINK
Wall Street analysts have been singing the company’s praises in response to the results and outlook. After the company’s strong earnings report, RBC Capital analyst Brad Erickson raised his price target on Meta to $800 saying, ‘… given the company’s leading position in AI, broad opportunities to grow utility for its users, and differentiated optionality stemming from compute capacity, we think that only the most select group of companies might be as comprehensively well-prepared to fully or over-participate in the long-term adoption of AI.’
Elsewhere, Rosenblatt analyst Barton Crockett raised his price target to $846, saying, “nobody is more bulled up on AI than Meta, and Meta might have more benefits to show from AI than anyone.
Meta stock is up around 23.5% in 2025 so far, leaving it trading on a 12-months rolling PE (price to earnings) multiple of 27.9, according to Stockopedia data.
