Top 10 Stocks on Analysts’ Radar These Days

2. Meta Platforms, Inc. (NASDAQ:META)

Number of Hedge Funds Investors: 235

Charles Schwab’s Jeff Pierce in a latest program on Schwab Network discussed reports saying Meta Platforms Inc (NASDAQ:META) is planning to launch a standalone AI app. He believes the company is trying to compete directly with ChatGPT.

“They’re certainly wanting to compete with ChatGPT, one of the most downloaded AI applications out there. But, of course, you’ve got Google with their Gemini, you’ve got Bing, you’ve got Microsoft Copilot, all of those, you know, in that competitive space for this AI investment. Now, we know on the investment side of it, Meta has decided to spend about 60 to 65 billion in capex this year to support these AI efforts, as well as the rest of their business. That’s a huge increase from last year—about 39 billion was spent last year. Investors have shown some concern over that spending in AI across many of these names. However, it does seem to be paying off. We saw Meta had about a 14% rise in their average price per ad in Q4, compared to just a 2% rise in Q4 of 2023. So, we’re seeing some pickup that seems to be related to these AI pushes out of the company.”

Rowan Street Capital stated the following regarding Meta Platforms, Inc. (NASDAQ:META) in its Q4 2024 investor letter:

“Meta Platforms, Inc. (NASDAQ:META): Investment Initiated: April 2018: Internal Rate of Return (IRR*): 22% *IRR represents the annualized rate of return on an investment, accounting for the timing and magnitude of cash flows over the holding period.

For META, our 22% IRR aligns closely with the company’s compounded growth in earnings per share (EPS) and free cash flow per share during the 6 years holding period.

Looking ahead, Meta is expected to grow its revenues, earnings, and free cash flow per share at mid-teens rates over the next two years. There’s a good possibility that it could exceed these estimates, considering the breadth of growth initiatives currently in place, such as advancements in Al, monetization of Reels, expansion into business messaging, and the ongoing development of the metaverse…” (Click here to read the full text)