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In a recent turn of events, Meta Platforms (NASDAQ:META) hit a momentous milestone by surging to $500 per share at the start of the previous month. The trajectory is promising but lacks the fiery spark that often accompanies such feats. Yet, dare we predict that this stock, akin to a phoenix rising from the ashes, will ascend to the lofty heights of $750 per share sooner than anticipated?
The Ever-Present AI Revolution
As the buzz around AI slowly dissipates amongst Meta’s esteemed “Magnificent Seven” peers, skepticism looms over the pace of inevitable growth and the sustainability of valuations. Macro uncertainties, such as the persistent specter of fluctuating interest rates, cast a shadow upon even the most elite AI stocks.
While these headwinds buffet the immediate landscape, Meta Platforms stock stands resilient. The prevailing notion is that the true potential of META’s AI endeavors has yet to be fully factored into the share price.
Indeed, the burgeoning trend of gen AI has started to yield positive results for Meta, propelling META to quadruple in value since the early days of 2023. Nevertheless, some, like InvestorPlace’s Thomas Niel, argue that the market’s perception of AI is narrowly focused only on enhancing Meta’s digital ad-centric revenue model.
A Glimmer of Hope Beyond AI
Assuming the much-anticipated “AI re-rating” unfolds as anticipated, how high can META soar solely on this impetus? Presently, META is valued at 25.7 times the estimated 2024 earnings of roughly $20 per share. While AI stocks focused on subscription software may sport forward multiples in the mid-30s, the most optimistic scenario would likely lead to only a partial re-rating, nudging META to around $600 per share.
Yet, fret not. The stage is set for META to transcend this boundary. Bolstered by organic growth and the fruits of the company’s “year of efficiency,” analysts forecast a robust 16% growth in earnings for 2025, projecting META’s trajectory toward the $700 per share mark.
And if that weren’t tantalizing enough, another potential catalyst could see the stock breaching the $750 per share threshold in under a year. The unexpected twist? A strategic departure from the metaverse, the very premise that underpinned the company’s rebranding in 2021.
Undeniable Appeal for Investors
As per Barron’s keen observer, Eric J. Savitz, META’s surge manifests for multiple reasons. Beyond the AI prowess and efficiency optimization, Meta’s steadfast commitment to shareholder returns via dividends and share buybacks plays a pivotal role in its ascent.
Yet, Savitz hints at another game-changing move in META’s arsenal – a potential retreat from its sizeable investment in the metaverse. Despite murmurs of Meta scaling back on these ventures, losses from its Reality Labs segment remain substantial at $16.1 billion annually.
Should Meta decide to pivot away from this bold venture, the market may jubilate in response to such strategic recalibration.
With Meta Platforms poised to ascend by 50% from its current juncture, the time is ripe for investors to take action and seize the opportunity that beckons.
META stock proudly boasts an A rating in Portfolio Grader.
On the publication date of this piece, neither Louis Navellier nor the primary InvestorPlace Research Staff member responsible for this article held any positions in the securities discussed.
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The post Meta Platforms Stock Prediction: Next Stop, $750 Per Share appeared first on InvestorPlace.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
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