‘Meta Stock Headed for $800': Mark Zgutowicz Weighs In Ahead of Earnings
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That ambition took center stage in mid-July, when CEO Mark Zuckerberg declared Meta's intention to invest 'hundreds of billions of dollars' into AI infrastructure in pursuit of Artificial Superintelligence. This isn't just about smarter ad targeting or better recommendation engines. We're talking about an all-out arms race to build a future where Meta could rival, or even outpace, the likes of OpenAI and Google DeepMind.
To turn that vision into reality, Zuckerberg announced plans to build roughly six gigawatts of data center capacity by 2030. Furthermore, Meta has spent the past month recruiting top-tier AI researchers from OpenAI and DeepMind, while also investing $14 billion in Scale AI and appointing its CEO as Meta's Chief AI Officer.
One analyst who's paying close attention is Benchmark's Mark Zgutowicz. While he maintains strong expectations for Meta's Q2 performance and sees promise in the company's evolving monetization strategy through e-commerce and ad pricing, the AI push is where the story really gets interesting.
According to Zgutowicz, even though his model already accounts for close to $500 million in capital expenditures through 2030, the real test will be in how well management deploys that capital to generate tangible returns. The analyst also notes that Meta faces stiff competition, pointing to OpenAI's current leadership and Google's entrenched dominance across much of the AI landscape, even before OpenAI's anticipated push into advertising in 2026.
As for the upcoming earnings, Zgutowicz expects a 'stable top-line' performance supported by steady e‑commerce trends, continued ad pricing momentum in North America, and higher revenue per advertiser thanks to new Advantage+ attribution tools launched in May. He also projects 2025 capex guidance to remain steady, with operating expenses inching higher to reflect the recent influx of elite AI talent. Looking further ahead, the analyst will be watching for management's tone regarding consensus forecasts that call for 2026 capex and opex growth of 9% and 14%, respectively.
With these expectations in mind, Zgutowicz assigns Meta stock with a Buy rating, while raising his price target from $640 to $800. (To watch Zgutowicz's track record, click here)
To find good ideas for stocks trading at attractive valuations, visit TipRanks' Best Stocks to Buy, a tool that unites all of TipRanks' equity insights.
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