Several Wall Street research firms are cutting their price targets on Facebook parent Meta Platforms (META) after the firm delivered worse-than-expected quarterly earnings and revealed that costs continue to rocket as part of the company’s artificial intelligence (AI) buildout.
On Wednesday, July 29, Meta reported revenues of $60.8 billion that were up 28% year-over-year and ahead of expectations for $60.2 billion. However, the bottom line fell well short, as earnings per share (EPS) of $6.18 earnings came in below Wall Street’s consensus mark of $7.14.
The miss was due to $2.4 billion in legal contingencies and a $1.2 billion charge for severance expenses. More concerning to investors, however, was the broader expense picture. Expenses grew 55% year-over-year, but even backing out those two issues, expenses were still 46% higher.
The result on Thursday was a steep plunge in META stock and some downward revisions among Wall Street’s analyst community.
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Analysts Reduce Their Targets for META Stock
Investors responded poorly, selling off shares by high single digits Thursday. Analysts’ responses were a little more muted, reducing their price targets on the stock but generally maintaining their views that META stock is still buy-worthy.
For instance, Nicolas Cote-Colisson, Head of Global Tech Platforms for HSBC Global Investment Research, reduced his price target to $830 per share from $905 previously.
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“Conference call comments indicate that the need for compute is not slowing down,” he says. “Meta already guides for up to $145 billion [in capital expenditures] in 2026, and we increase our 2027-28 forecasts to $176 billion and $185 billion (+29% on average vs. old forecasts). … Higher capex means slightly negative cash flow in the near future (negative $1 billion in 2026 and 2027).”
Still, Cote-Colisson’s downwardly revised target still implies another 42% from Wednesday’s closing price (and even more from Thursday’s reduced levels), and he maintains his Buy rating on the stock.
| Meta Platforms (META): Quick Stats | |
|---|---|
| Market cap | $1.6 trillion |
| Dividend yield | 0.4% |
| Forward price-to-earnings (P/E) | 21.0 |
| Price/earnings-to-growth (PEG) | 0.95 |
| Source: Yahoo! Finance. Data is as of July 29, 2026. | |
“We think that Meta, with its strong 3.6 billion-user base, is in a unique position to leverage one of the largest existing data sets with its AI systems,” he says. “We believe that Meta’s AI investments will continue to drive growth; Meta’s forthcoming products, including agents, have the potential to generate new revenue streams, in our view, but it remains too early to assess their value, absent more concrete details and timeline.”
BNP Paribas Equity Research Senior Analyst Nick Jones also cut his price target, by 10% to $885 per share (51% upside from Wednesday’s close), but also maintained his Outperform rating (equivalent of Buy).
“The lack of clear near-term returns on investments in combination with the potential need for incremental capital will likely weigh on Meta’s multiple,” he says. “However, we do not view tonight’s results as thesis changing and continue to see ample runway for Meta to continue driving monetization improvements while introducing new revenue streams.”
Oppenheimer analysts (Perform, equivalent of Hold) remained muted on the stock. While they increased their 2027 and 2028 revenue and EPS estimates, their expectations for 4% EPS growth remain well below the Street’s consensus targets. They say the company’s 17 forward P/E on shares is “a rich multiple for limited growth.”
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Despite the weak quarter and target cuts, META stock remains a clear favorite among Wall Street analysts.
According to data from S&P Global Market Intelligence, the company currently enjoys 55 Buy-equivalent ratings versus just seven Holds and no Sells. That’s driven by their views for long-term (the next three to five years) annual earnings growth, which currently sit at 22% on average. And right now, the average 12-month target of $784.40 per share implies 34% upside from Wednesday’s close.
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