Meta Platforms Stock on the Rise: Analyst Upgrades Outlook

by Warren Seah

TD Cowen analyst, John Blackledge, has upgraded shares of Meta Platforms (ticker: META), the parent company of Facebook and Instagram, expressing confidence in the company’s future plans to monetize its popular apps.

Blackledge’s upgrade of Meta stock to Outperform from Market Perform comes with a higher price target of $345, up from $220. Additionally, he has increased his revenue and earnings estimates for the next five years by an average of 8% and 7% respectively.

With this new price target, Meta stock potentially has about 10% more upside. As of Thursday trading, the stock is already up 1.4% to $313.70, reaching an intraday 52-week high of $316.24.

This bullish outlook from Blackledge follows Meta’s impressive 160% surge in stock price this year. He believes there is still room for further growth as Instagram Reels and Threads continue to gain traction in terms of engagement and monetization.

Instagram Reels offers short videos that can be viewed directly within the app. This feature competes with other platforms like TikTok and YouTube Shorts. According to Meta’s first-quarter earnings call, Reels has been instrumental in driving overall app engagement.

Blackledge notes, “Our survey data indicates steady growth in Reels engagement and increased time spent on Instagram. This aligns with management’s recent comments that Reels is fueling engagement on Instagram.” He adds, “Meta is currently working on monetizing Reels, and we expect it to contribute significantly to Meta’s top line in the coming years.”

In addition to Facebook and Instagram, Meta recently launched Threads, a microblogging app that rivals Twitter. Threads amassed over 100 million users within just five days.

Blackledge points out that his current Meta forecast does not include any potential revenue generated from Threads. However, he anticipates that Meta will focus on monetizing the app once it improves the product and establishes a clear path to reaching one billion users.

As Meta Platforms stock continues its ascent, investors are eager to see how the company capitalizes on these opportunities.

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