BofA Reiterates Buy on META as AI Spending Fears Ease

2 months ago 54

Ghazal Ahmed

Sun, December 21, 2025 astatine 2:25 PM CST 2 min read

Meta Platforms, Inc. (NASDAQ:META) is 1 of the AI Stocks connected the Market’s Radar. On December 18, BofA Securities reiterated its “Buy” standing connected the banal with a terms people of $810.00. Despite the caller aggregate compression, the steadfast is constructive connected the banal driven by cardinal near-term catalysts.

BoFA noted however Meta has lagged the broader marketplace and immoderate of its biggest peers contempt analysts having raised Meta’s 2026 net estimates. Investors person grown cautious connected the banal amid concerns astir AI spending and rising operating costs.

Stock marketplace charts. Photo by Kaboompics.com connected Pexels

“2025 YTD, Meta banal (up 11% y/y) has underperformed the NASDAQ (up 18%) and Alphabet (up 56%). Although Meta’s 2026 statement EPS estimates accrued 16% from the commencement of 2025, the 2026 P/E aggregate contracted successful 2H’25 arsenic AI sentiment deteriorated and 2026 Opex concerns grew.”

Despite these concerns, the steadfast finds Meta’s 2026 disbursal guidance and LLM motorboat successful the archetypal fractional of 2026 arsenic imaginable adjacent word catalysts. Looking ahead, investors volition stay focused connected AI concern walk and the returns these investments whitethorn make crossed halfway apps, advertizing monetization, and caller concern opportunities.

The steadfast besides mentioned successful their capitalist enactment however management’s commentary regarding costs to physique LLMs compared to licensing tin assistance amended sentiment.

“Given Meta’s important concern successful LLM improvement (without a licensing gross model), we deliberation absorption commentary connected LLM physique outgo vs. licensing, and the semipermanent benefits of an in-house LLM could beryllium adjuvant for sentiment.”

Meta Platforms has been expanding its advertizing capabilities and besides invests heavy successful artificial quality and the metaverse.

While we admit the imaginable of META arsenic an investment, we judge definite AI stocks connection greater upside imaginable and transportation little downside risk. If you're looking for an highly undervalued AI banal that besides stands to payment importantly from Trump-era tariffs and the onshoring trend, spot our escaped study connected the best short-term AI stock.

READ NEXT: 10 Trending AI Stocks connected Wall Street and 10 Buzzing AI Stocks connected Wall Street.

Disclosure: None.