Meta’s shares are navigating a complex landscape as the new trading week begins. While the stock maintains a solid year-to-date gain, a confluence of factors—including revised analyst targets, escalating capital expenditures, and an unexpected board departure—is prompting a reassessment of its near-term outlook among investors.
The core concern centers on the company’s aggressive spending to build out its artificial intelligence infrastructure and whether market patience for this investment pace will hold.
Rising Costs and Revised Targets
Recent reports indicate a significant cost overrun for a planned AI data center in Louisiana, with estimates ballooning from an initial $10 billion to nearly $27 billion. This underscores CEO Mark Zuckerberg’s commitment to positioning Meta at the forefront of AI development. However, it has also revived concerns that the company could be entering another period of heavy spending reminiscent of its earlier Metaverse investments.
Against this backdrop, Wedbush Securities adjusted its outlook. Analyst Scott Devitt maintained his “Outperform” rating on Friday but reduced the price target from $920 to $880, citing valuation considerations in light of rising infrastructure costs.
Board Reshuffle and Divergent Analyst Views
Adding to the narrative, Meta confirmed the resignation of Dina Powell McCormick from its Board of Directors. The former Goldman Sachs executive and one-time advisor to the Trump administration had served on the board for only eight months. The company did not cite official conflicts or strategic differences, but such abrupt departures often draw close market scrutiny.
Should investors sell immediately? Or is it worth buying Meta?
Providing a counterbalance, Bank of America Securities reaffirmed its “Buy” recommendation. Its analysts pointed to Meta’s expenditure guidance for 2026 and the planned launch of a new Large Language Model (LLM) in the first half of that year as potential catalysts. They believe these developments could help the stock recover its recent underperformance relative to the Nasdaq.
Market Position and Technical Levels
Operationally, Meta’s core business remains stable. The company is progressively integrating its “Andromeda” AI models into its advertising technology to enhance retargeting efficiency, even amid broader sector concerns about ad demand.
The equity currently trades approximately 19% below its 52-week high, suggesting a consolidation phase where the market is recalibrating the balance between substantial AI investments and growth prospects in advertising.
In the short term, the share price is hovering around a key support level near $660. Trading volumes in recent sessions have been notably above average. The next major milestone is the fourth-quarter earnings report, scheduled for January 28, 2026.
Until then, the stock is likely to be swayed by technical factors and further details on investment plans for the upcoming fiscal year. The overall analyst consensus remains favorable with a “Strong Buy” rating, although recently tempered price targets signal a slight moderation in near-term expectations for the shares.
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