Latest news with #MetaPlatforms
Yahoo
8 hours ago
- Business
- Yahoo
This "Magnificent Seven" Stock Is Set to Skyrocket If Its AI Investments Pay Off
Meta Platforms has investments in several AI applications. The tech giant's stock is only valued on its legacy business. Patient investors should be rewarded as these efforts progress. 10 stocks we like better than Meta Platforms › Over the past two-and-a-half years, investors have heard about various artificial intelligence (AI) investments that tech companies are making. Some of these are already starting to be used on a near-daily basis, while others may still take a few years to emerge. But an often-overlooked question is: What happens if these AI efforts pay off? Some of these investments are only valued based on their current business, and don't have any upside priced into them should their AI activities become a huge part of the investment thesis. One of those companies is Meta Platforms (NASDAQ: META), the parent company of social media sites like Facebook and Instagram. I'd argue that the stock is being valued only on its legacy business, and it could take off once its AI investments begin to pay off. Why do I think Meta is valued based on its current business? Well, when we look at its trailing price-to-earnings (P/E) ratio, it's not all that different from where it has traded over the past seven-and-a-half years. This tells me the market values it based on what it's doing now, but some of the investments it's making could transform the company. One area that AI can assist with is efficiency. CEO Mark Zuckerberg has claimed that AI has become so advanced that sometime this year, AI will be able to code at the same capacity as a mid-level software engineer. While this may cause some people to lose their jobs, software engineer expenses are incredibly high for some companies like Meta. By replacing these workers with AI, Meta's expenses will drop dramatically, significantly boosting profits. Meta also believes that its AI investments will lead to an improved advertising experience. Zuckerberg commented that AI has already refined how Meta defines and targets audiences, but it's also improving the ad creation side. This combination could boost Meta's ad business and allow it to charge a premium on ads because it can promise a better outcome for its clients. As a result, Zuckerberg thinks ad-related revenue will become a much larger part of global GDP, and its platforms will be one of the biggest beneficiaries of that trend. Another area Meta sees huge potential in is AI devices. Meta has chosen the path of integrating AI into glasses, and some models are already available through its collaboration with Ray-Ban. However, the devices that Meta is developing are far more advanced and will help people immerse themselves in AI throughout the day, which could have many productivity benefits (or drawbacks). Zuckerberg estimated that more than a billion people already wear glasses today, which is a massive market opportunity for Meta to capture should its AI glasses become a hit. Massive AI tailwinds are blowing in Meta's favor, but the stock is only priced based on its legacy ad business, not on any of its future endeavors. I think this presents a great investment opportunity, as you're only paying for Meta's legacy business, not any of the AI-powered upside. Meta only needs one of its AI investments to work out, but if it sees success in many of the various AI investments it has made, the stock could become one of the best performers in the market. However, some short-term fears are prevalent in the market. Meta gets 98% of its revenue from ads right now, so as the ad market goes, so will Meta's stock. Advertising tends to be a poor business in economic downturns, and it's unknown how all the uncertainty caused by tariffs will affect the ad market moving forward. Fortunately, advertising markets tend to bounce back stronger after a downturn, so even if Meta's primary business takes a short-term dip, it will be OK over a longer holding period. Investors willing to hold Meta Platforms' stock for at least three to five years should see a significant return on their investment due to the various AI improvements they're implementing. With the stock priced at about the same level it has been for previous years, now seems like a solid time to buy the stock, as you don't have to worry about overpaying right now. Before you buy stock in Meta Platforms, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the for investors to buy now… and Meta Platforms wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. Consider when Netflix made this list on December 17, 2004... if you invested $1,000 at the time of our recommendation, you'd have $638,985!* Or when Nvidia made this list on April 15, 2005... if you invested $1,000 at the time of our recommendation, you'd have $853,108!* Now, it's worth noting Stock Advisor's total average return is 978% — a market-crushing outperformance compared to 171% for the S&P 500. Don't miss out on the latest top 10 list, available when you join . See the 10 stocks » *Stock Advisor returns as of May 19, 2025 Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. Keithen Drury has positions in Meta Platforms. The Motley Fool has positions in and recommends Meta Platforms. The Motley Fool has a disclosure policy. This "Magnificent Seven" Stock Is Set to Skyrocket If Its AI Investments Pay Off was originally published by The Motley Fool Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
8 hours ago
- Business
- Yahoo
Germany Considers 10% Digital Tax On Tech Giants Alphabet, Meta: Report
In a move that could escalate trade tensions with the U.S., Germany is reportedly contemplating imposing a 10% tax on major online platforms, including Alphabet Inc. (NASDAQ:GOOGL) (NASDAQ:GOOG) and Meta Platforms Inc. (NASDAQ:META). What Happened: Wolfram Weimer, the new German Minister of State for Culture, disclosed this proposal in an interview with Stern magazine. This revelation comes before Chancellor Friedrich Merz's anticipated visit to Washington, although no official confirmation has been provided yet, reported Reuters. Trending: Maker of the $60,000 foldable home has 3 factory buildings, 600+ houses built, and big plans to solve housing — President Donald Trump has previously expressed his disapproval of foreign governments taxing American companies, pledging not to let them 'appropriate America's tax base for their own benefit.' Weimer accused big online platforms like Alphabet Inc. and Meta Platforms Inc. of 'cunning tax evasion.' He suggested that these companies, which generate billions in profits in Germany, contribute minimally to the country's tax base and society. Weimer also criticized the monopolistic tendencies of these digital platforms, arguing that they pose a threat to freedom of It Matters: This proposal comes amid growing international scrutiny of tech giants. The Trump administration has been critical of Europe's digital regulations, asserting that they pose a risk to free speech and American commercial interests. Furthermore, in April, European Commission President Ursula von der Leyen warned that the EU is preparing retaliatory measures that could include levies on digital advertising revenues from U.S. tech companies like Meta and Alphabet Inc. This was followed by Meta CEO Mark Zuckerberg urging President Trump to respond aggressively to these threats. If the German government proceeds with this tax, it would join Britain, Italy, France, Spain, Turkey, India, Austria, and Canada, which have imposed similar taxes on digital service providers. The shares of Alphabet fell 0.24% to close at $172.96 on Thursday, meanwhile Meta rose 0.23% to $645.05. Read Next: Hasbro, MGM, and Skechers trust this AI marketing firm — Invest before it's too late. Deloitte's fastest-growing software company partners with Amazon, Walmart & Target – Many are rushing to grab 4,000 of its pre-IPO shares for just $0.30/share! Photo courtesy: JHVEPhoto / Send To MSN: Send to MSN Up Next: Transform your trading with Benzinga Edge's one-of-a-kind market trade ideas and tools. Click now to access unique insights that can set you ahead in today's competitive market. Get the latest stock analysis from Benzinga? This article Germany Considers 10% Digital Tax On Tech Giants Alphabet, Meta: Report originally appeared on Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
10 hours ago
- Business
- Yahoo
Meta (META) AI Reaches 1 Billion Users, Eyes Paid Features and Subscriptions
We recently published a list of . In this article, we are going to take a look at where Meta Platforms, Inc. (NASDAQ:META) stands against other AI stocks on Wall Street's radar. Meta Platforms, Inc. (NASDAQ:META) is a global technology company. On May 28, CNBC reported that Meta Platforms, Inc. (NASDAQ:META)'s artificial intelligence assistant, Meta AI, has one billion monthly active users across the company's family of apps. CEO Mark Zuckerberg disclosed the news at the company's annual shareholders meeting, stating how the 'focus for this year is deepening the experience and making Meta AI the leading personal AI with an emphasis on personalization, voice conversations, and entertainment.' CNBC further remarked how this milestone follows Meta's April rollout of its stand-alone app for the tool. Zuckerberg wants the AI tool to keep growing before a business can be built around it. As the Meta AI assistant improves over time, 'there will be opportunities to either insert paid recommendations' or offer 'a subscription service so that people can pay to use more compute.' Photo by Timothy Hales Bennett on Unsplash 'It may seem kind of funny that a billion monthly actives doesn't seem like it's at scale for us, but that's where we're at.' Overall, META ranks 1st on our list of AI stocks on Wall Street's radar. While we acknowledge the potential of META as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than META and that has 100x upside potential, check out our report about this cheapest AI stock. READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires. Disclosure: None. This article is originally published at Insider Monkey.
Yahoo
17 hours ago
- Business
- Yahoo
Famous Investor Remains Very Upbeat on META Platforms (META)
Meta Platforms, Inc. (NASDAQ:META) and its CEO, Mark Zuckerberg, are "delivering" and "executing," while the tech giant's "fundamentals" are strong, Stephanie Link, who frequently appears on CNBC, said on the channel recently. Link is the Chief Investment Strategist at Hightower Advisors. The advertising behemoth delivered "the best" first-quarter earnings out of all of the Mag 7 names, Link said. In addition to providing "beat-and-raise" earnings, Meta Platforms, Inc. (NASDAQ:META) generated revenue growth of 16% in Q1, versus the same period a year earlier, Link noted. Additionally, its margins climbed 3.6 percentage points year-over-year, the famous investor pointed out. Calling the overall results "remarkable," Link added that Meta Platforms (NASDAQ:META)'s free cash flow, capital spending, and operating expenditures "all (moved) in the right direction." Finally, she is pleased with Meta's decision to continue investing heavily in AI. In the last month, the shares have climbed 17%, while they have fallen 5% in the last three months. While we acknowledge the potential of META as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than META and that has 100x upside potential, check out our report about this cheapest AI stock. READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires. Disclosure: None. This article is originally published at Insider Monkey. Sign in to access your portfolio
Business Insider
17 hours ago
- Business
- Business Insider
Analysts Remain Bullish on Meta Platforms Stock Despite Near-Term Headwinds
Meta Platforms (META) stock has risen 16.3% over the past month and is up 10.2% year-to-date. The company impressed investors with its market-beating first-quarter results. However, macro uncertainty and tariff wars could weigh on ad spend and impact Meta's performance. Despite near-term headwinds, most Wall Street analysts remain bullish on META stock, as they are confident about the social media giant's strong positioning, solid execution, and resilience. Confident Investing Starts Here: Meta Platforms' Impressive Performance Meta Platforms topped analysts' Q1 2025 revenue and earnings estimates, with its ad revenue rising 16% to $41.4 billion. Moreover, the company reported a 6% increase in daily active users across its family of apps (Facebook, Instagram, Messenger, and WhatsApp) to 3.43 billion. The company is leveraging AI (artificial intelligence) to enhance its tools. Meta's artificial intelligence assistant, Meta AI, now has one billion monthly active users across the company's family of apps. While Meta Platforms lowered its full-year expenses outlook, it raised its capex guidance to the range of $64-$72 billion from $60-65 billion for additional data center investments to support its AI initiatives and a rise in the expected cost of infrastructure hardware. Overall, Meta CEO Mark Zuckerberg expressed confidence in navigating the ongoing macro uncertainties. Analysts' Views on META Stock's Growth Trajectory Recently, Loop Capital analyst Rob Sanderson increased the price target for Meta Platforms stock to $888 from $695 and maintained a Buy rating, citing the company's upbeat Q2 2025 outlook. The 5-star analyst stated that his expectation that a drop in spending intensity from China-based advertisers would flatten revenue growth was a 'misread.' Sanderson believes that META stock remains the best non-hardware example of a tangible, 'right-now beneficiary of AI.' He expects META stock to outperform the Magnificent 7 peer group this year. Likewise, encouraged by the Q1 results and second-quarter outlook, Guggenheim analyst Michael Morris reaffirmed a Buy rating on META stock and increased the price target to $725 from $675. The 5-star analyst noted that management's discussion and outlook focused on continued pursuit of the growth opportunities in AI, engagement, and advertising, with the guidance reflecting the impact of macro uncertainty, demand headwinds from Asian e-commerce exporters, and healthy April ad trends. Morris believes that overall, Meta Platforms indicated that demand across its portfolio remains strong, as reflected in the 6% user growth, 5% impression growth, and 10% ad pricing growth. META's enhanced engagement is driven by AI developments, primarily through improved content recommendations, noted the analyst. Overall, Morris continues to view Meta as the 'best positioned digital ad player,' particularly as more supply is expected to come online later this year. Is META a Good Stock to Buy? With 41 Buys, three Holds, and one Sell recommendation, Wall Street has a Strong Buy recommendation on Meta Platforms stock. The average of $696.12 implies about 8% upside potential from current levels.
