Meta Platforms (META) stock has rallied more than 65% this year but shares of the Facebook parent company have plenty of upside heading into 2025, an analyst said Monday.
Monness, Crespi, Hardt analyst Brian White reiterated a buy rating for Meta stock and 12-month price target of 660.
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“Meta has handily outperformed our coverage universe at large in 2024 and posted the best performance within our megacap group,” White wrote in a client note. “Despite the stock’s sharp rise, Meta’s valuation remains reasonable in our view. Moreover, we believe the ramp of newer products, the infusion of gen AI across the portfolio, and the expansion of advertising across a wider swath of the platform position Meta well in 2025.”
On the stock market today, Meta stock was down more than 1% at 590 in morning trades, as the broader market slumped.
Analyst View: What To Watch In 2025
White added that a TikTok ban could also boost Meta but he’s “not counting on such an outcome.” The Supreme Court is scheduled to review a law requiring TikTok’s parent company to sell the popular social media app on Jan. 10. President-Elect Donald Trump has requested the court delay the law in the meantime. It would take effect Jan. 19.
Another factor to watch for Meta stock next year is its AI spending. White noted that Meta’s capital expenditure plan this year grew to a range of $38 billion to $40 billion, whereas initial plans from Meta called for spending between $30 billion and $35 billion. Much of the capital expenditure is going toward data centers to power the Facebook parent’s AI ambitions.
“Despite Meta’s big CapEx investments in 2024, we are modeling strong free cash flow of $48.1 billion and a rich free cash flow margin of 29.4%,” White wrote. “Furthermore, our current EPS estimate of $23.17 for 2024 is up sharply from our projection of $18.93 a year ago.”
White estimates that next year Meta reach $53.4 billion in CapEx, up 38% from 2024’s projected total. But Meta has a “strong gen AI foundation” and an advertising business that could help the social media giant continue to generate strong profits despite the CapEx investments, the note added.
“We believe Meta is well positioned to benefit from the digital ad trend, expand the reach of its platform, innovate with gen AI, and leverage a leaner cost structure,” White wrote. “However, regulatory scrutiny persists, and the macro remains fragile.”
Meta Stock Tests 50-Day Line
Meanwhile, Meta stock has traded lower in recent days along with the broader market. Shares fell a half-percent Friday, landing below a former flat base buy point of 602.95. After slumping below Meta’s shorter-term 21-day moving average late last week, Meta stock is testing support at its 50-day line.
The Facebook parent’s stock broke out from the flat base chart pattern on Dec. 3 and climbed to reach a record 638.40 on Dec. 11 before this recent pullback.
Meta stock has an IBD Composite Rating of 97 out of 99, per IBD Stock Checkup. It is the third highest-rated stock out of 69 members in the internet content group tracked by IBD.
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