JPMorgan has moved Meta Platforms Inc. to a Neutral rating from Overweight and lowered its price target to $725 from $825, pointing to rising infrastructure investment and limited clarity around the company’s artificial intelligence product roadmap.
While recognizing Meta’s recent top-line momentum, analyst Doug Anmuth expressed concern about the longer-term return profile of the company’s AI investments. "While we’re encouraged by META’s +33% Y/Y revenue growth which has been supported by AI-driven ad stack optimizations, accelerating impression growth, & engagement gains, we believe full-stack AI competition is intensifying and Meta has a more challenging path to returns on heavy AI capex beyond advertising," Anmuth wrote.
JPMorgan contrasted Meta’s position with that of Google and Amazon, saying those competitors appear to have stronger enterprise integrations and clearer paths to multi-year returns from AI capital deployments.
Meta recently raised its 2026 capital expenditure guidance by $10 billion, setting a new range of $125 billion to $145 billion. Based on that guidance and its own assumptions, JPMorgan now forecasts Meta’s capex will expand 42% to $202 billion in 2027. The firm projects this ramp will result in negative free cash flow of $4 billion in 2026 and $24 billion in 2027.
Anmuth also highlighted several near-term headwinds that could pressure results, including tougher year-over-year comparisons, exposure to conflict in the Middle East, the implementation of European regulations, and foreign exchange pressures.
Reflecting these dynamics, Anmuth wrote that JPMorgan is moving to a Neutral rating and cautioned that shares could remain under pressure until investors see clearer evidence about agentic products and how Muse models will produce revenue beyond advertising.
JPMorgan’s $725 price target is grounded in a valuation of 21 times its 2027 GAAP earnings-per-share estimate of $34.01.
Contextual note - The firm’s stance balances acknowledgement of recent revenue strength against growing uncertainty about capital allocation and return on intensive AI-related investments. Investors and market participants will likely watch Meta’s disclosure and execution on product monetization closely as capex commitments rise.