A 'Significant Rally' Is Ahead for Meta Platforms Stock (META), Says Mizuho
Mizuho analysts predict a significant rally for Meta Platforms (META) stock due to spending cuts in metaverse projects, potentially boosting earnings. They recommend buying META shares, with a price target of $815, 23% above current levels. The stock has a consensus Strong Buy rating, with an average price target implying a 26.2% upside.
Analysts at bank Mizuho Financial Group (MFG) see a "significant rally ahead" for technology stock Meta Platforms (META).
TipRanks Cyber Monday Sale
- Claim 60% off TipRanks Premium for data-backed insights and research tools you need to invest with confidence.
- Subscribe to TipRanks' Smart Investor Picks and see our data in action through our high-performing model portfolio - now also 60% off
The bullish note from Mizuho comes with META stock up 4% on Dec. 4 amid reports that the company is planning to cut 30% of its spending on projects related to the virtual reality "metaverse." Analysts at Mizuho say cuts to Meta Platforms' metaverse spending could drive a significant rally in the share price.
Specifically, Mizuho says that the pullback in spending at Meta is the shift that investors had been hoping for and could represent a significant catalyst for the share price, sending it higher. "We see a significant rally ahead for Meta shares, and recommend investors add to positions," writes Mizuho.
Meta's Spending Cuts
In a note to clients, Mizuho writes that the proposed spending cuts could add $2 a share to Meta Platforms' 2026 earnings estimate of $29.50 by reducing losses among various metaverse projects. The Reality Labs division that houses the metaverse at Meta Platforms is on pace to lose $18 billion this year.
Mizuho notes that investor sentiment has been "despondent" since Meta's third-quarter financial results, when the company projected higher capital expenditures in 2026 instead of signaling a pullback. Analysts add that frustration with Reality Labs is rising after the unit posted $80 billion in cumulative losses since 2019.
Mizuho has a Buy-equivalent outperform rating on META stock and an $815 price target, which is 23% higher than where the shares currently trade.
Is META Stock a Buy?
The stock of Meta Platforms has a consensus Strong Buy rating among 43 Wall Street analysts. That rating is based on 36 Buy, six Hold, and one Sell recommendations issued in the last three months. The average META price target of $834.90 implies 26.2% upside from current levels.
