Key Factors
-
Wall Avenue’s median goal worth values Meta Platforms at $815 per share, implying 36% upside from its present share worth.
-
Meta inventory is down 24% from its excessive regardless of robust first-quarter outcomes, as traders fear about capital expenditures.
-
Meta’s second-quarter monetary report is due on July 29, and traders can be in search of an replace regarding AI monetization.
- 10 shares we like higher than Meta Platforms ›
Meta Platforms (NASDAQ: META) inventory is down 24% from its excessive amid considerations about how a lot cash the corporate is spending on synthetic intelligence infrastructure. Buyers will get extra info on that subject when Meta proclaims second-quarter monetary outcomes on Wednesday, July 29.
Nevertheless, Wall Avenue sees a shopping for alternative forward of the report. Amongst 71 analysts, Meta has a median goal worth of $815 per share. That suggests 36% upside from its present share worth of $598.
The place to speculate $1,000 proper now? Our analyst crew simply revealed what they imagine are the 10 finest shares to purchase proper now, if you be part of Inventory Advisor. See the shares »
This is what traders ought to take into account earlier than shopping for Meta inventory.
Picture supply: The Motley Idiot.
Meta is primarily monetizing AI by its promoting enterprise
Meta Platforms owns the three hottest social media platforms by month-to-month energetic customers: Fb, WhatsApp, and Instagram. The corporate makes use of shopper knowledge generated by these platforms to suggest content material and goal adverts, making a community impact that makes its social media properties extra participating for customers (and extra priceless for advertisers) over time.
Meta Platforms is investing aggressively in synthetic intelligence infrastructure. Earlier this 12 months, the corporate raised its 2026 capital expenditure (capex) forecast to $135 billion on the midpoint, up from $125 billion. That’s almost double its $72 billion in capex spending in 2025, which itself was almost double the $39 billion in capex spending in 2024.
Meta is already realizing returns on these investments. Within the first quarter, advert impressions delivered throughout its social media properties elevated 19%, and the typical worth per advert elevated 12%. These adjustments replicate larger person engagement and higher advertiser demand, pushed by proprietary AI fashions that rank and suggest content material.
Nonetheless, Meta inventory at the moment trades 24% beneath its excessive, suggesting that traders are anxious about whether or not the corporate can earn adequate returns on that invested capital. On that subject, Bloomberg experiences that Meta is planning to lease out extra compute capability to prospects, primarily making a neocloud enterprise much like CoreWeave.
Meta has not commented on the Bloomberg report, however administration may weigh in on the subject when the corporate experiences monetary outcomes this week. Meta may tackle different AI monetization alternatives, together with its private assistant, Meta AI. The corporate not too long ago added procuring mode and activity automation options to the product, increasing its addressable market.
Meta inventory appears low cost regardless of the danger of post-earnings volatility
Meta Platforms will report second-quarter monetary outcomes after the inventory market closes on Wednesday, July 29. The Wall Avenue consensus estimate requires income to extend 26% to $60.1 billion, whereas earnings develop lower than 1% to $7.22 per share. Whether or not the inventory strikes up or down after the report relies upon as a lot on what administration says because it does on the precise monetary outcomes.
For instance, Meta beat estimates within the first quarter, however the inventory nonetheless dropped 9% the following day as a result of traders have been extra involved in regards to the firm elevating its capex outlook. The identical factor may occur this time. Certainly, Alphabet inventory dropped following a robust monetary report final week, just because the corporate raised its capex forecast.
As of July 27, choices pricing info implies a 7% transfer in Meta inventory (both larger or decrease) after the corporate proclaims its second-quarter monetary outcomes. Which means the stakes are notably excessive for potential traders, however I believe the inventory is price shopping for at its present worth, regardless of near-term volatility.
Wall Avenue expects Meta’s earnings to extend at 22% yearly over the following three years. That makes the present valuation of 21.5 occasions earnings look low cost. These metrics give a price-to-earnings-to-growth (PEG) ratio barely beneath 1, which is often interpreted as indicating a inventory is undervalued. Meta’s PEG ratio is at the moment at its lowest degree in three years. I see that as a sexy entry level for long-term traders.
Do you have to purchase inventory in Meta Platforms proper now?
Before you purchase inventory in Meta Platforms, take into account this:
The Motley Idiot Inventory Advisor analyst crew simply recognized what they imagine are the 10 finest shares for traders to purchase now… and Meta Platforms wasn’t considered one of them. The ten shares that made the lower may produce monster returns within the coming years.
Contemplate when Netflix made this checklist on December 17, 2004… when you invested $1,000 on the time of our advice, you’d have $377,990!* Or when Nvidia made this checklist on April 15, 2005… when you invested $1,000 on the time of our advice, you’d have $1,269,518!*
Now, it’s price noting Inventory Advisor’s complete common return is 896% — a market-crushing outperformance in comparison with 206% for the S&P 500. Do not miss the newest high 10 checklist, obtainable with Inventory Advisor, and be part of an investing neighborhood constructed by particular person traders for particular person traders.
See the ten shares »
*Inventory Advisor returns as of July 28, 2026.
Trevor Jennewine has no place in any of the shares talked about. The Motley Idiot has positions in and recommends Alphabet and Meta Platforms. The Motley Idiot has a disclosure coverage.
The views and opinions expressed herein are the views and opinions of the creator and don’t essentially replicate these of Nasdaq, Inc.
