Meta Draws Strong Buy Cases as European Legal and Privacy Pressure Rises
Bullish analyst forecasts face new legal/privacy threats from reporting on employee data collection for AI alongside an EU court ruling that supports publisher compensation.
Overview
- Wolfe Research reiterated an Outperform rating and set an $800 price target for Meta while saying the stock trades at about 16 times estimated 2027 earnings and forecasting roughly 22% revenue growth in 2027.
- Analysts and some investors still see Meta as attractively valued, but they are worried about very large capital spending and negative free cash flow, with annual capex cited around $145 billion.
- Reuters reported that internal Meta documents show plans to collect detailed employee computer-usage records to train AI models and that the program would also capture some non-U.S. data.
- Europe’s top court backed an Italian telecoms regulator that ordered Meta to compensate publishers for news snippets, creating a legal precedent that could affect how tech firms use third-party content for AI.
- Investors are divided: hedge funds bought Meta in Q1 as some push the long-term growth case, while rights groups and regulators warn the data plans and court ruling could prompt fresh privacy and compliance costs that affect users, publishers, and Meta’s AI rollout.