JPMorgan reiterated an “Overweight” rating on Meta (NASDAQ: META) on Monday, March 16, with an $825 META stock price target coming in following reports that the company is planning to lay off 20% of its workforce to offset artificial intelligence (AI) infrastructure costs.
The bank estimates that layoffs could help the company save $5–6 billion, although admitting that the figure wouldn’t matter much in the grand scheme of things, considering Meta has $162–169 billion in total expenses projected for this year.
Bernstein followed suit, reiterated both its “Outperform” rating and $900 price target on Meta, arguing the AI shift strengthens the long-term outlook. The firm acknowledged growing concerns about how AI could reshape employment, but expressed belief that Meta is among the best-positioned tech names to evolve into an AI-first organization.
For illustrative purposes, the investment management firm pointed to Meta’s post-COVID-19 restructuring, which reduced non-technical roles and streamlined management layers. Indeed, Meta now maintains an 82% gross profit margin and has generated $200.97 billion in revenue over the past 12 months, representing 22% year-over-year (YOY) growth.
Needham not so sure about Meta
In contrast, Needham maintained a “Hold” rating on Meta, assigning no price target and highlighting some AI–related risks.
For example, analyst Laura Martin noted that Meta remains smaller than major rivals such as Amazon (NASDAQ: AMZN) and Alphabet (NASDAQ: GOOGL), and its plans to develop superintelligence could require up to a decade of sustained investments.
Another concern raised is potential economic value leakage from Meta’s open-system AI strategy, particularly through its Llama models. Unlike closed AI ecosystems, such as those by OpenAI, Meta’s approach may limit monetization and make it less able to capture the value of consumer data.
Finally, Martin also raised broader economic questions surrounding generative AI, including whether the technology will primarily improve productivity or replace labor and contribute to higher unemployment. Still, she argued that Meta should continue its aggressive capital spending, which could ultimately strengthen its competitive position.
Meta stock price target
All things considered, Meta is still one of the most widely recommended companies, with forty-four analysts collectively calling it a “Strong Buy” over the past three months, citing data available on TipRanks at press time.
Those same analysts have given an average META stock price target of $858, implying a nearly 37% upside from current levels. More impressively, the Street-high price sits at $1,140.
Featured image via Shutterstock
