Connect with us

Hi, what are you looking for?

Editor's Pick

1 Wall Street Analyst Says Meta Platforms Will Fall to $360. Is It a Sell?

Meta Platforms (META 0.93%) has been a big winner over the past year and a half, but the stock has slipped following its recent earnings report in April.

Although the social media titan beat analyst estimates on the top and bottom lines, investors didn’t like its plans to increase capital spending and operating expenses in order to invest in artificial intelligence (AI) and other strategic initiatives. Its second-quarter revenue guidance was also a bit lighter than expected, leading to a nearly 11% slide on the report.

Now, one Wall Street analyst thinks Meta’s a sell.

Exane BNP Paribas says to avoid Meta

Last week, Exane BNP Paribas initiated coverage on Meta Platforms with an underperform rating and a price target of $360, implying a downside of 24% from Wednesday’s prices.

Analyst Stefan Slowinski called an increase in AI spending with a new revenue stream to complement, and he said other “Magnificent Seven” stocks are better prepared to monetize generative AI technology.

Is this metaverse round 2?

Like other big tech companies such as Alphabet, Meta has a highly profitable core advertising business from its social media platform, which allows it to invest in more experimental businesses like the metaverse and now AI.

However, the metaverse has been a massive drain on profits thus far, as Meta reported an operating loss of nearly $4 billion in the first quarter. While its social media business is strong enough to carry that, focusing too much on a technology it can’t fully monetize is a legitimate concern for investors.

If Meta’s stock is trading at $360 a year from now, and the company delivers the $20.75 per share analysts currently expect (according to S&P Global Market Intelligence), that would be a price-to-earnings ratio of 17.3 — lower than today’s multiple around 27 but still higher than the doldrums of its first year as Meta.

If the company can maintain spending discipline, its stock should be a winner, but investors are loath to see another episode of the metaverse money pit.

This post appeared first on

You May Also Like


Newmont (NYSE: NEM) reported mixed financial results even as the price of gold approached its all-time high. In all, the company’s earnings per share...


Fisker (NYSE: FSR) stock price has been one of the best-performing electric vehicle (EV) stocks this week even as Tesla slumped. The shares jumped...


NatWest (LON: NWG) share price rose sharply, helped by the strong results from Barclays. The stock jumped to a high of 274.8p, which was...


The Fox Corporation (NASDAQ: FOX) stock price has been under pressure as investors come to terms with the abrupt firing of Tucker Carlson. The...

Disclaimer:, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the-company.

Copyright © 2024