Metaplatforms (NASDAQ: META) has been one of the most promising stories of the rise of artificial intelligence (AI) so far. You may know the company best for its social media apps (Facebook, Messenger, Instagram and WhatsApp), but Meta is also very present in the world of AI. The company has big AI ambitions and has been investing heavily in the area.
But in recent weeks, along with other tech players, Meta’s stock has faltered. This comes as investors grapple with a range of concerns, from geopolitics to specific industries. Weighing most heavily on Meta are these industry-related concerns, with the idea that the revenue opportunity from AI may not match the spending levels we’ve seen.
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Still, Meta has been reporting solid earnings growth and the overall message from the AI community is that demand continues to increase. With this in mind, could Meta stock reach $800? Let’s find out.
As mentioned, Meta is a social media giant and today that is what drives the company’s multi-million dollar revenue. Advertisers come to Meta to communicate with us through these applications, and that has generated double-digit revenue growth and high profitability. In fact, Meta has developed such financial strength that it can afford to pay dividends to shareholders and invest aggressively in the development of its AI.
Meta sees his role in AI as “building personal superintelligence.” In all its applications, Meta aims to offer personalized content and services for the user, and this should make us spend more time on these applications. As a social media leader, Meta is well positioned to take on that task. Meanwhile, Meta is working to automate the advertising process and make ads increasingly profitable for those who place them.
The company’s AI research and development should also help it develop new products and services over time that can expand its revenue opportunities. Therefore, there are reasons to be optimistic about Meta’s journey into AI, and also about its strong and stable social media business.
Now, let’s consider the path to $800. The stock is trading at about $660 right now, so this would imply a 21% gain and take the market value to $1.7 trillion, up from $1.6 trillion today. So from a mathematical perspective it works and could easily happen.