Rothschild Redburn moved to a Buy rating on Meta Platforms Inc. on Monday, increasing its price target to $900 from $740 while acknowledging material short-term cost pressures. At the time of the note, the social media company was trading at $658.76 and carried a market capitalization of $1.66 trillion. The company is scheduled to report fourth-quarter results in two days on January 28.
The research house said it recognizes near-term concerns tied to Meta’s escalating investment program. analysts at Rothschild Redburn observed that CEO Mark Zuckerberg appears to be operating in what they described as "founder mode," pursuing artificial-intelligence investments irrespective of immediate financial cost.
As a result, Rothschild Redburn raised its fiscal year 2026 total cost projection to $158.6 billion, which sits above the consensus estimate of $150.5 billion and buy-side expectations near $155.0 billion. The firm also increased its FY26 capital-expenditure forecast to $117.1 billion versus a consensus capex estimate of $110.0 billion.
Those higher cost and capex assumptions translate into a roughly $2.75 earning-per-share headwind relative to current consensus estimates, Rothschild Redburn calculated. The firm suggested that consensus FY26 EPS could temporarily fall to approximately $27-28 from the current $29.55 once fourth-quarter results are reflected - an adjustment that it said could push the stock lower toward the mid-$500s.
Despite those nearer-term stresses, Rothschild Redburn framed its upgrade around the disconnect it sees between prevailing share price levels and long-term intrinsic value. The firm concluded that at about $650 per share, Meta’s "upside potential far outweighs any near-term risks to the downside."
Other brokerages have issued a range of reactions ahead of the earnings release, underscoring a mix of optimism and caution across the sell side.
- BofA Securities maintained its Buy rating and projects fourth-quarter revenue of $59.2 billion and earnings per share of $8.27, both noted as slightly above consensus.
- Evercore ISI reiterated an Outperform rating and retains a $875 price target while projecting what it described as a "Modest Beat & Bracket Q4."
- Raymond James trimmed its price target to $800, characterizing Meta’s AI transition as an "awkward phase," though it still forecasts revenue growth above consensus for 2026 and 2027.
- Wells Fargo lowered its price target to $754 but kept an Overweight rating despite the $41 cut.
- Stifel moved its target down to $785, expressing concerns about AI spending while also noting strong Instagram Reels performance in the fourth quarter.
The collective analyst commentary paints a picture of a major technology company balancing an aggressive AI investment program and elevated capital deployment against ongoing business strengths such as advertising and engagement on its platforms. As Meta approaches its next earnings release, the divergent price targets and ratings reflect differing views on how quickly those investments will translate into durable financial returns.
Given the range of forecasts, market participants will be watching both the near-term financial metrics and management commentary closely. Any adjustment to consensus EPS or new color on FY26 spending and capex could materially influence near-term stock moves, while the longer-term debate centers on whether current investments produce value that justifies higher valuations.