Analysts are boosting their expectations for Meta Platforms stock as the Facebook parent company prepares to release its third quarter results later this month.
Meta stock is up a fraction at 593.30 on the stock market today. Analysts with Stifel and Goldman Sachs both raised their target price and estimates for Meta stock in separate client notes prior to market open Monday.
Stifel analyst Mark Kelley's preview for third quarter digital advertising results said industry check-ins for Meta were "positive across the board." In particular, he is bullish on the AI-powered ad tools for Facebook, Instagram and Messenger called Advantage+.
"We believe the Advantage+ suite is still underpenetrated, and positive feedback suggests there is still room for increased adoption, which may translate into greater budget allocation across Meta," wrote Kelley, who rates Meta stock a buy.
Kelley raised his estimates for Meta's third quarter revenue to the "high end" of the company's guidance. Further, he raised Stifel's price target for Meta stock to 663 from 590.
At Goldman Sachs, analysts similarly upped Meta stock estimates to 636, from 555 while keeping a buy rating. The report cited the analysts' expectation for strong topline growth for Meta, according to a description by Investing.com.
Meta Stock: Estimate For Q3 Results
Stifel's Kelley noted that commentary about overall third quarter advertising spending was largely positive.
"U.S. election advertising ramped significantly after a sluggish start, which we believe was largely due to lack of visibility on the Democratic Party ticket; this provides some cushion to 3Q and should translate into some upside to 4Q guides," Kelley wrote.
Election spending in the U.S. typically benefits Google, Meta and The Trade Desk most, according to the Stifel note.
Meta will release its third quarter results after the market closes on Oct. 30. Analysts polled by FactSet project Meta will post earnings of $5.20 per share, up 18% from a year earlier. Analysts project sales will increase 17.6% to $40.16 billion.
Goldman Sachs and Stifel aren't the only the firms raising their estimates for Meta ahead of the report. Meta's average target price from the 70 analysts following the stock is 601.79, according to FactSet. That's up from 587.56 at the start of the month.
Meta stock is currently trading above a 5% buy range from a 542.81 consolidation-pattern buy point identified by MarketSurge. The firm recently hosted its Connect event that focused on AI and the metaverse initiatives.
Meta stock is on the IBD Tech Leaders list, as well as the IBD 50 premium stock list.
Meta has gained more than 65% this year. The rally trails only Nvidia (NVDA) for the best performance among the Magnificent Seven stocks.
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