Analysts downgrade Meta stock price target as the company ‘lags on AI'

Core Viewpoint - Meta Platforms has been downgraded from 'Buy' to 'Neutral' by Arete analyst Rocco Strauss due to concerns about its ability to generate meaningful revenue from AI investments [1][2] Financial Performance - Meta's spending trajectory is increasing rapidly, with projected capital expenditures for 2026 expected to be between $115 billion and $135 billion, a significant rise from $72.2 billion in 2025 [3][4] - Arete has reduced its stock price target for Meta from $732 to $676, indicating skepticism about the company's revenue growth relative to its spending [2] Competitive Position - There are concerns that Meta is lagging behind competitors like Alphabet in terms of third-party demand for AI [4] - Despite the downgrade, the average stock price target for Meta remains at $858.86, suggesting a potential increase of around 28% over the next twelve months according to TipRanks data [6][8] Market Sentiment - The recent price cut has not significantly impacted market sentiment, as Meta is still rated a 'Strong Buy' by forty-four analysts in the past three months [8]