Meta Loses $400 Billion, Auctions More Stock, But Analysts Still See 1.4x Upside
Meta Platforms has shed practically $400 billion in market worth since late September. On Monday, the Facebook and Instagram proprietor launched a $35 billion inventory sale to pay for its synthetic intelligence (AI) build-out.
New shares unfold Meta’s future earnings throughout extra house owners, shrinking every current holder’s slice. Yet Wall Street analysts nonetheless price the inventory a purchase, with a mean goal about 1.4 occasions the present worth.
Why Meta Is Selling Stock After a $400 Billion Drop
Meta spent $34.9 billion on knowledge facilities, chips, and different tools within the third quarter. That pushed free money movement, the money left after these prices, to damaging $2.12 billion, in response to its results. A 12 months earlier, it was constructive $10.6 billion.
Long-term debt rose to $80.9 billion from $58.7 billion on the finish of 2025. Meanwhile, the corporate purchased again no shares within the quarter.
Operating margin, the share of income left as revenue from operations, halved to twenty%. However, a $9.89 billion authorized cost drove a lot of that drop.
It covers a settlement with 52 US state attorneys normal over teen psychological well being claims. Revenue nonetheless grew 26% to $64.6 billion.
Meta expects to spend $135 billion to $145 billion this 12 months. Its SEC filing additionally outlines as much as $60 billion in gross sales of recent non-voting Class C shares from early 2027. Those shares elevate cash with out diluting Mark Zuckerberg’s voting management.
Chipmakers NVIDIA, AMD, and Broadcom indicated non-binding curiosity in shopping for as much as $5 billion of the brand new inventory.
What Analysts Expect From Meta Stock Now
Meta traded close to $624 as of this writing, nearly 20% under its September peak, the same old threshold for a bear market.
Still, 38 of 44 analysts tracked by TipRanks price it a purchase, and none say promote. Their common goal of $852.31 sits about 36% above the present worth. The lowest goal, $580, is already under it.
Zuckerberg defended the spending when Meta reported outcomes.
“Our investments are paying off, the core enterprise is robust, and we’re seeing velocity throughout the board.”
Microsoft and Alphabet report earnings on Wednesday, with their growing AI bills beneath the identical scrutiny.
This season, buyers have punished Big Tech for elevating and slicing AI budgets alike. Meta now takes that no-win earnings test with damaging free money movement.
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