On Thursday, Jefferies, a global investment banking firm, adjusted its outlook on Meta Platforms Inc. (NASDAQ: NASDAQ: META ) shares by reducing the price target to $540 from the previous $585. The firm continues to endorse a Buy rating for the social media conglomerate.
The revision comes as Meta reported an uptick in revenue growth for the first quarter, increasing to 27% year-over-year from 22%. However, projections for the second quarter suggest a slowdown in revenue growth to 18% year-over-year, slightly below the consensus estimate of 20%. The analyst highlighted that the anticipated deceleration might not fully reflect the company’s potential, given its history of capitalizing on investment cycles to deliver substantial returns.
Meta’s increase in the full-year 2024 total expense and capital expenditure outlooks has also been a point of consideration. Despite these increases, Jefferies maintains confidence in Meta’s ability to achieve a $24 earnings per share (EPS) in fiscal year 2025. By applying a 22x multiple to this EPS estimate, the firm justifies the $540 price target for Meta’s stock.
The analyst from Jefferies underscored Meta’s proven track record, suggesting that the company’s prior investments have historically yielded significant returns. This perspective supports the firm’s continued recommendation to buy, despite the lowered price target.
InvestingPro Insights
As Meta Platforms Inc. (NASDAQ: META) faces a dynamic market environment, real-time data from InvestingPro offers additional context for investors considering Jefferies’ revised price target. With a robust market capitalization of $1.25 trillion and a forward-looking P/E ratio of 29.8, Meta demonstrates significant size and a valuation that is reflective of its expected earnings growth. The company’s revenue growth over the last twelve months, standing at a notable 15.69%, underscores its ability to increase sales at a healthy clip despite market challenges.
Two key InvestingPro Tips highlight Meta’s financial health and market position. First, the company holds more cash than debt on its balance sheet, indicating a strong liquidity position that could bolster investor confidence. Second, Meta is recognized as a prominent player in the Interactive Media & Services industry, which may reassure investors of its competitive standing. For those looking for more in-depth analysis, there are 15 additional InvestingPro Tips available, offering a comprehensive view of Meta’s financials and market performance.
For investors seeking to make informed decisions, InvestingPro provides a nuanced perspective on Meta’s financial outlook. Use coupon code PRONEWS24 to receive an additional 10% off a yearly or biyearly Pro and Pro+ subscription, and gain access to a wealth of insights that can help navigate the investment landscape with greater confidence.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.
