Meta Platforms price target raised to $585 from $525 at Oppenheimer

Oppenheimer raised the firm’s price target on Meta Platforms to $585 from $525 and keeps an Outperform rating on the shares as AI driving revenue upside. The firm is also increasing Q1 to high-end of guidance, raising rest of 2024 and increasing 2025 revenue to +13% vs. prior +12%. While historical seasonality still suggests upside to the second half of 2024, the firm’s model now implies 337bps of share gains vs. 6-year average of 305bps, indicating significant gains built-in. To re-rate to an “AI multiple,” or 25-30-times, investors would need to believe EPS could grow over 25% in 2025, representing $3B of incremental net income through stemming losses in Reality Labs or driving 2025 revenue growth to 16%, representing 700bps share gains, which seems unlikely, Oppenheimer says.