Meta stock gained in trading Thursday, after a Wall Street analyst team raised their target price for the social media stock. Amazon also got a price target hike but closed the day lower.
A new report from Jefferies on Thursday reiterated a buy rating for Meta. Analyst Brent Thill upped Jefferies' price target for the Facebook parent company to 585, from 550. Separately, Thill raised Jefferies price target for Amazon stock to 225, from 190, and reiterated a buy rating.
On the stock market today, Meta stock gained just under 1% to close at 510.92. Amazon stock, meanwhile, gained in early trading but retreated 1.3% to close at 180.
Meta Stock: 'Too Many Advantages To Count'
The new price target for Meta incorporates an updated market share analysis from Jefferies analysts, according to the client note.
Thill wrote that Meta has "too many advantage to count" compared to competitors in the digital advertising market. Ads drive nearly all of Meta's revenue. The company has been investing in artificial intelligence tools to help drive more engagement and ad sales on its applications, which include Facebook, Instagram, Reels, WhatsApp and Threads.
"We believe Meta's decision to invest $27 billion in capex in FY23 has helped the company develop several strategic advantages over peers," Thill wrote to clients.
Those advantages include a strong artificial intelligence-based recommendation engine for its Reels short-video product, which is driving more time spent on Facebook and Instagram. Further, Meta's AI-powered Advantage+ tools for buying ads are also driving "significant improvements in advertiser ROI," the Jefferies note said.
Meta will report its first quarter earnings on April 24. Meta stock is up 45% this year.
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Amazon Stock: Still 'Plenty To Like'
Separately, Thill and the Jefferies internet analyst team published a positive note on Amazon Thursday after meeting with industry experts and former employees.
Amazon has a "positive opportunity" in advertising supported video for its Prime streaming platform and an "improving cloud environment' for its Amazon Web Services business, according to the note. The Jefferies analyst team added, however, that its expert believes Amazon "needs to improve its AI offering to stay competitive."
Amazon has not yet set a date for its first quarter earnings report. FactSet estimates the report will come later this month. Amazon shares have gained just under 20% so far in 2024.
Both Amazon and Meta are on several IBD stock lists. Meta is on the Tech Leaders, IBD 50, Big Cap 20 and the premium IBD Leaderboard list. Amazon, meanwhile, is part of the IBD Tech Leaders list.
