Meta Platforms (META) AI Stock Analysis

• Market Cap: $1.63T
• Dividend Yield: 0.32%
• Average Volume (3M): 16.32M
• Price to Earnings (P/E): 27.4
• Beta (1Y): 1.29
• Revenue Growth: 22.17%
• EPS Growth: -2.66%
• Country: US
• Employees: 76,834
• Sector: Communication Services
• Sector Strength: 97
• Industry: Internet Content & Information
• EPS (TTM): 8.88
• Shares Outstanding: 2,187,177,700
• 10 Day Avg. Volume: 11,845,679
• 30 Day Avg. Volume: 16,321,979
• PEG Ratio: -10.75
• Price to Book (P/B): 7.66
• Price to Sales (P/S): 8.28
• P/FCF Ratio: 36.09
• Enterprise Value/Market Cap: 1.05
• Enterprise Value/Revenue: 8.46
• Enterprise Value/Gross Profit: 10.32
• Enterprise Value/Ebitda: 16.05
• 1Y Price Target: $852.60
• Price Target Upside: 30.04% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 43
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 81 Outperform
• Price Target: $743.00 ▲(13.32% Upside)
• Action: Reiterated Date: 01/30/26
• Date: Action: Reiterated 01/30/26

The score is driven primarily by very strong profitability and cash generation, tempered by rising leverage and signs of moderating growth. Technicals remain supportive but look overbought, while valuation is somewhat expensive with a very low dividend yield. Earnings call takeaways were positive on ad and AI momentum, but the large planned 2026 expense/capex ramp and ongoing Reality Labs losses add execution risk.

Positive Factors

Profitability & Margins

Meta's elite margins reflect durable operating leverage across its ad platform and content distribution. High gross and net margins provide persistent cash flow cushion to invest in AI infrastructure, fund new initiatives, and absorb cyclical ad volatility without immediate margin strain.

Cash generation & Liquidity

Strong historical operating and free cash flow gives Meta durable funding capacity for large-scale AI and infrastructure spending. Reliable cash conversion supports multi-year investments, reduces reliance on dilutive financing, and provides flexibility to sustain strategic initiatives during cycles.

Scale & Ad Monetization

Massive daily reach plus rising impressions and ad prices underpins a structurally advantaged ad business. Scale enables superior targeting, continuous product optimization and AI-driven monetization gains, creating a persistent competitive moat versus smaller rivals over the medium term.

Negative Factors

Rising Debt Levels

A meaningful jump in total debt reduces financial flexibility and raises interest and refinancing risk if the trend continues. Higher leverage constrains optionality for acquisitions or incremental capex and increases the importance of sustaining cash flow to avoid funding stress.

2026 Expense & CapEx Ramp

A planned, sizable step-up in operating expenses and capex to scale AI and compute creates execution risk and compresses near-term free cash flow. Successful long-term payoff depends on timely capacity expansion and monetization; missteps could erode margins and strain resources.

Regulatory & Legal Risks

Persistent regulatory and legal pressure can force product changes, restrict personalized ads, and increase compliance costs. Structural shifts in ad targeting rules or large penalties would materially affect Meta's primary revenue engine and could reduce long-term monetization efficacy.

Meta Platforms Business Overview & Revenue Model

Company Description

Meta Platforms, Inc. engages in the development of products that enable people to connect and share with friends and family through mobile devices, personal computers, virtual reality headsets, and wearables worldwide. It operates in two segments, Family of Apps and Reality Labs. The Family of Apps segment offers Facebook, which enables people to share, discuss, discover, and connect with interests; Instagram, a community for sharing photos, videos, and private messages, as well as feed, stories, reels, video, live, and shops; Messenger, a messaging application for people to connect with friends, family, communities, and businesses across platforms and devices through text, audio, and video calls; and WhatsApp, a messaging application that is used by people and businesses to communicate and transact privately. The Reality Labs segment provides augmented and virtual reality related products comprising consumer hardware, software, and content that help people feel connected, anytime, and anywhere. The company was formerly known as Facebook, Inc. and changed its name to Meta Platforms, Inc. in October 2021. Meta Platforms, Inc. was incorporated in 2004 and is headquartered in Menlo Park, California.

How the Company Makes Money

Meta generates the majority of its revenue through advertising. Businesses pay to promote their products and services on Meta's platforms, leveraging advanced targeting capabilities based on user data and behavior. This includes display ads, video ads, and sponsored content across its various services. Additionally, Meta earns revenue through its Reality Labs segment, which includes the sale of virtual reality hardware, such as Oculus devices, and software applications. The company has formed significant partnerships with various advertisers and content creators to enhance its monetization strategies. Furthermore, Meta's investments in the metaverse and augmented reality may open new revenue streams in the future as these technologies evolve.

Meta Platforms Financial Statement Overview

Summary

Exceptional profitability and scale (very high gross/EBIT/net margins) with strong cash generation. Key offsets are a slower 2025 revenue growth snapshot versus 2024 and a meaningful rise in total debt into 2025, plus some historical free-cash-flow variability tied to investment cycles.

Income Statement

Meta shows exceptional profitability and scale, with 2024 gross margin (~82%), EBIT margin (~43%), and net margin (~38%) at very strong levels. Growth has been solid from 2022–2024 (2024 revenue up ~22%), but the 2025 annual snapshot shows a slower revenue growth rate (~6%), suggesting a moderation in top-line momentum. Overall, margins and earnings power are elite, with the main watch item being the trajectory of revenue growth after the 2024 rebound.

Balance Sheet

The balance sheet is strong, supported by a large equity base ($182.6B in 2024) and healthy profitability on equity (~34% in 2024). Leverage remains reasonable for the business model (2024 debt-to-equity ~0.27), though total debt has risen meaningfully into 2025 ($83.9B vs. $49.1B in 2024), which reduces balance-sheet flexibility versus prior years. Overall financial position remains robust, with the key risk being the pace of debt build if it continues.

Cash Flow

Cash generation is strong, with 2024 operating cash flow of ~$91.3B and free cash flow of ~$54.1B, and operating cash flow comfortably exceeding net income (about 2.7x in 2024). Free cash flow growth has been positive recently (2023 and 2024), but free cash flow conversion to net income is moderate (~59% in 2024) and free cash flow declined sharply in 2022 before rebounding—indicating some volatility tied to investment/capex cycles. Overall, cash flow is a major strength, with variability in free cash flow the primary downside.

Breakdown	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	200.97B	164.50B	134.90B	116.61B	117.93B
Gross Profit	164.79B	134.34B	108.94B	91.36B	95.28B
EBITDA	104.55B	86.88B	59.05B	37.69B	55.27B
Net Income	60.46B	62.36B	39.10B	23.20B	39.37B
Balance Sheet
Total Assets	366.02B	276.05B	229.62B	185.73B	165.99B
Cash, Cash Equivalents and Short-Term Investments	81.59B	77.81B	65.40B	40.74B	48.00B
Total Debt	83.90B	49.06B	37.23B	26.59B	13.87B
Total Liabilities	148.78B	93.42B	76.45B	60.01B	41.11B
Stockholders Equity	217.24B	182.64B	153.17B	125.71B	124.88B
Cash Flow
Free Cash Flow	46.11B	54.07B	43.85B	19.04B	39.12B
Operating Cash Flow	115.80B	91.33B	71.11B	50.48B	57.68B
Investing Cash Flow	-102.00B	-47.15B	-24.50B	-28.97B	-7.57B
Financing Cash Flow	-20.37B	-40.78B	-19.50B	-22.14B	-50.73B

Meta Platforms Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 655.66
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Positive
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For META, the sentiment is Neutral. The current price of 655.66 is below the 20-day moving average (MA) of 670.78, below the 50-day MA of 656.98, and below the 200-day MA of 689.45, indicating a bearish trend. The MACD of -2.74 indicates Positive momentum. The RSI at 48.80 is Neutral, neither overbought nor oversold. The STOCH value of 35.79 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for META.

Meta Platforms Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
META	81 Outperform	$1.63T	27.39	30.24%	0.32%	22.17%	-2.66%
GOOGL	74 Outperform	$3.67T	28.07	35.70%	0.26%	13.55%	34.26%
RDDT	72 Outperform	$28.17B	54.91	20.94%	―	69.71%	―
AMZN	67 Neutral	$2.20T	28.56	22.29%	―	11.48%	50.70%
PINS	66 Neutral	$10.89B	27.46	8.78%	―	16.79%	819.94%
Sector *	60 Neutral	$48.67B	4.58	-11.27%	4.14%	2.83%	-41.78%
SNAP	55 Neutral	$8.24B	-18.26	-19.46%	―	11.75%	49.19%

Meta Platforms Corporate Events

Meta Platforms Names Dina Powell McCormick President, Vice Chair

Meta Platforms’ board of directors appointed Dina Powell McCormick as President and Vice Chairman of the company, effective January 12, 2026, bringing to the leadership team a veteran executive with extensive experience in global finance and U.S. government service. Powell McCormick, a former senior partner at Goldman Sachs and most recently Vice Chair, President and Head of Global Client Services at BDT & MSD Partners, previously served on Meta’s board from April to December 2025 and then as an external adviser, and will receive a compensation package that includes a $1 million annual base salary, a $2 million sign-on bonus, a target bonus equal to 200% of salary, and $60 million in restricted stock units vesting over four years, along with standard indemnification and severance protections designed to secure her equity value in the event of an early termination.

The most recent analyst rating on (META) stock is a Buy with a $880.00 price target. To see the full list of analyst forecasts on Meta Platforms stock, see the META Stock Forecast page.

Meta Platforms announces immediate resignation of board member

On December 19, 2025, Meta Platforms, Inc. announced that Dina Powell McCormick notified the company of her decision to resign from its Board of Directors, with the resignation taking effect immediately. The departure marks a change in the company’s board composition, which may influence governance dynamics and strategic oversight at the social media giant going forward.

The most recent analyst rating on (META) stock is a Buy with a $880.00 price target. To see the full list of analyst forecasts on Meta Platforms stock, see the META Stock Forecast page.

Meta Platforms Reaches Settlement in Privacy Case

On July 17, 2025, Meta Platforms reached a settlement in principle to resolve a stockholder derivative action in the Delaware Court of Chancery, with a settlement hearing scheduled for April 7, 2026. This legal action, which has been ongoing since 2018, involves claims related to Meta’s privacy practices and disclosures, with several plaintiffs and defendants, including Meta’s top executives, implicated in the proceedings. The settlement aims to resolve all claims and dismiss the action with prejudice, pending court approval, potentially impacting Meta’s legal and operational landscape.

The most recent analyst rating on (META) stock is a Buy with a $800.00 price target. To see the full list of analyst forecasts on Meta Platforms stock, see the META Stock Forecast page.