Meta Is Betting $50 Billion on AI Data Centers. Where Does The Stock Go From Here?

Meta earns a BUY rating with a $904 price target implying 33% upside, supported by 57 analyst buy ratings and zero sells.

Alphabet's capex of up to $185 billion dwarfs Meta's plan, yet Meta's 33% ad revenue growth makes its 21x forward P/E look reasonable against peers.

Q1 capex surged 47% to $19 billion while business AI conversations jumped tenfold to 10 million weekly, powering both the risk and the reward.

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Meta Platforms ( NASDAQ:META ) is spending like an infrastructure company and being valued like a growth company. With full-year 2026 capex guidance raised to $125 to $145 billion to build out AI data centers, the question is whether shareholders get paid back for that bet.

Our proprietary model says yes. The 24/7 Wall St. price target for Meta is $903.93, implying 32.67% upside from $681.31. Our recommendation is buy with high confidence.

Meta has been a rollercoaster. Shares are up 12.96% in the past week and 14.8% over the past month, but only 3.39% year to date and down 3.78% over the past year. The stock sits 4% below its 52-week high of $793.65 after bouncing off a 52-week low of $519.78.

Q1 2026 was a blowout: EPS of $10.44 beat expectations of $6.66 on revenue of $56.31 billion, up 33.08% YoY. Ad impressions rose 19% and average price per ad rose 12%. The stock initially sold off to $608.75 a day after the earnings report as investors digested the raised capex line.

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The bull case rests on Meta's ability to convert AI compute into ad monetization. Family daily active people reached 3.56 billion, and Susan Li noted a 10% lift in Reels time spent on Instagram after Q1 ranking upgrades. Business AI conversations are running at more than 10 million weekly, up from 1 million at the start of the year.

Mark Zuckerberg said Meta is "on track to deliver personal superintelligence to billions of people." Our bull scenario points to $1,033.70, a 51.72% return if Muse Spark and business agents scale on schedule.

The bear case starts with capex intensity. Q1 capex hit $19 billion, up 46.8%, and Reality Labs still bled $4.03 billion. Insider activity is not encouraging: COO Javier Olivan has been selling weekly, with CFO Susan Li disposing of 9,195 shares on May 18, 2026 around $604 to $611.

Bulls counter that these dispositions are largely scheduled RSU vestings rather than discretionary sales, and that the $8.03 billion tax benefit boosting Q1 EPS is a real cash item tied to CAMT R&D guidance. Our bear scenario lands at $773.09, a 13.47% return. Watch items include EU DMA pressure and 2026 youth-litigation trials.

Alphabet ( NASDAQ:GOOGL ) is the cleanest comp because both are AI hyperscalers funding data-center builds from ad cash flow. Alphabet's 2026 capex guide of $175 to $185 billion dwarfs Meta's plan, and Google Cloud posted $20.03 billion in Q1 revenue, up 63% YoY. Alphabet trades near a similar forward multiple with a diversified cloud engine Meta lacks, making Meta's forward P/E of 21x look reasonable rather than rich.

Pinterest ( NYSE:PINS ) offers a smaller-scale ad-platform contrast. Pinterest grew Q1 2026 revenue 17.8% to $1.01 billion with 631 million MAUs. Meta's 33% ad revenue growth at vastly larger scale, plus 41.44% operating margins, makes our $903.93 target look conservative against the peer set.