Meta Stock: Wall Street Holds Firm on Bullish Targets Before Wednesday Earnings

TLDR

• Meta stock holds $810-$875 analyst price targets with Q4 earnings set for January 28, expecting revenue of $59.2 billion
• Advertising demand surges 29% year-over-year in Q4 according to agency checks, driven by AI improvements and Instagram Reels
• Analysts forecast 2026 expenses climbing 30-36% to $153-$160 billion, making expense guidance critical focus area
• AI targeting delivers 4% ROI lift for advertisers while Instagram Shops and partnership ads expand revenue opportunities
• Price targets range from Wells Fargo’s $754 to HSBC’s $905 against current trading price of $658.76

Meta stock faces a critical test on January 28 when the company reports fourth-quarter results. Analysts aren’t backing down from their optimistic forecasts despite shares trading at $658.76.

Meta Platforms, Inc., META

BofA Securities maintains its Buy rating with an $810 price target. The firm predicts Q4 revenue hitting $59.2 billion with earnings per share of $8.27. Both figures top consensus estimates of $58.3 billion and $8.20.

Evercore ISI takes an even stronger stance at $875 with an Outperform rating. The firm expects what it calls a “Modest Beat & Bracket Q4” performance.

Strong Ad Demand Powers Revenue Outlook

The advertising story looks solid heading into earnings. One major agency reported Meta spending growth of 29% year-over-year in Q4. Overall digital ad spending exceeded expectations at 8.1% growth versus 7.2% forecasted.

Meta’s AI investments are delivering tangible results. One buyer specifically noted a 4% return on investment improvement on the platform in 2025. This kind of performance metric matters to advertisers allocating budgets.

Instagram Reels continues gaining traction as a revenue driver. Instagram Shops are picking up momentum. Partnership ads create new inventory sources for the platform.

BofA projects first-quarter 2026 revenue of $52.3 billion with EPS of $6.31. The Street expects $51.2 billion and $6.29. Meta’s guidance will likely target Q1 revenue between $50.0-$52.5 billion, representing 18-24% year-over-year growth.

Expense Guidance Will Move the Stock

The real drama centers on 2026 expense projections. BofA forecasts total expenses ranging from $153-$160 billion, jumping 30-36% from last year. Wall Street consensus sits at $150 billion.

Capital expenditure guidance should land between $109-$114 billion versus Street expectations of $110 billion. These numbers reflect Meta’s heavy AI infrastructure investments.

Investor concerns about spending have built up over five months. Expense growth guidance around 30% could spark positive reactions. Guidance at or above 35% might trigger selling pressure.

Evercore sees potential risk to Wall Street’s expenditure assumptions. The firm still views the Street’s Q4 operating profit estimate of $23.8 billion as reasonable based on management’s track record.

Not everyone shares the same enthusiasm. Wells Fargo cut its price target to $754 from $795 while keeping an Overweight rating. Stifel dropped to $785 from $875, worried about AI investment levels despite strong Instagram Reels performance.

HSBC takes the most bullish position at $905. The firm credits Meta’s early AI adoption and substantial technology investments as advantages for its advertising business.

Meta’s gross profit margin stands at 82% with 21.3% revenue growth over the past twelve months. The stock trades at a P/E ratio of 29.29 with fiscal 2025 EPS forecasts at $29.48.

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