Meta Platforms price target lowered to $570 from $600 at RBC Capital

RBC Capital analyst Brad Erickson lowered the firm’s price target on Meta Platforms to $570 from $600 but keeps an Outperform rating on the shares. The company’s Q1 results were solid in terms of top-line and advertising demand trends, but the issue for the stock is an accelerated, multi-year AI investment cycle that exceeded investor expectations, the analyst tells investors in a research note. RBC adds that despite the lower price target, it would be buying shares as Meta is driving a durable, industry-leading conversion improvement on its core business, and AI only expands its moat vs. peers with compounding improvements to engagement & ad efficiency. The firm further states that Meta’s elevated investments increase its long-term compute capacity optionality to address any incremental market opportunities where AI exists.