Colin Sebastian comments on Meta Stock after the Meta Connect conference

Meta Platforms (NASDAQ:META) Fans had plenty to enjoy on Wednesday at Meta Connect, the social media giant's annual developer conference.

Highlights included the launch of Meta's Orion AR glasses prototype, showcasing neural hand gesture control and lightweight design. The company also introduced the Quest 3S mixed reality headset at a competitive price of $299.99. Additionally, Meta announced significant improvements to its AI offerings, including AI chatbots with celebrity voices and improved AI-powered tools for Instagram and WhatsApp. Not to be outdone, Ray-Ban smart glasses also received exciting updates with language translation and deeper AI integration.

Meta also introduced Llama 3.2, its latest major language model with significant improvements. Llama 3.2 represents a major advance as it is the first Llama model with multimodal capabilities, meaning it can process and analyze both text and images. This enables interpretation of visual data, such as identifying objects in photos, making it a direct competitor to models like OpenAI's GPT-4 and Anthropic's Claude 3.

In summary, Baird's Colin Sebastian, a 5-star analyst ranked in the top 4% of equity professionals on the Street, believes the Llama update “further differentiates Meta's LLMs from closed competitors (e.g. Claude, Chat-GPT, Gemini). ”

While Sebastian believes the event offered “more of an incremental update,” he believes it showcased the company’s “significant progress” in Reality Labs and AI/GenAI.

“Understandably,” the top analyst continued, “Meta is focused on product and usability before monetization, although we continue to see a variety of monetization options beyond that, including search-based advertising, subscriptions, microtransactions, and content sales.” better overall ad performance.”

Meanwhile, Sebastian has raised its META estimates due to generally positive trends in social media advertising, with September showing some improvement after a slight decline in August. He now expects revenue to reach $184.4 billion in 2025 (representing 13.9% year-over-year growth versus 13% previously), while his 2024 and 2025 EPS estimates are also up $21.28 and $23.23 respectively, compared to the previous $20.98 and $22.46 respectively.

Considering the “significant opportunities” ahead, Sebastian also raised his price target for Meta from $530 to $605. Sebastian's rating remains Outperform (i.e. Buy). (To view Sebastian's track record, click here)

Other analysts are similarly optimistic. The consensus rating for Meta is Strong Buy based on 41 Buys, 3 Holds, and 1 Sell. However, considering the shares' outperformance – up 61% year-to-date – the average price target of $597.38 implies slight upside potential of ~5% from current levels. (See Meta stock forecast)

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Disclaimer: The opinions expressed in this article are solely those of the featured analyst. The content is for informational purposes only. It is very important to do your own analysis before investing.