HSBC Upgrades Meta Stock, Targets $900 Price Surge

It seems like AI is not the only thing Meta is mastering; earnings beats and wider margins are on the syllabus as well. Facebook, Instagram, and WhatsApp’s parent, which is Meta Platforms, got encouragement this week from HSBC. The investment bank raised its rating from a “Hold” to “Buy.”

This elevation also came with a new price target of $900, which represents a 29.5% move above Meta’s current trading levels. The upgrade is supported by increased operational forecasts and wider optimism regarding Meta’s long-term earnings ability.

HSBC Raises Meta’s Valuation Benchmark

In Thursday’s research note, HSBC explained its rating change by applying to a more elevated valuation multiple to Meta’s earnings. The bank is now consuming an estimated 2026 price-to-earnings (P/E) multiple of 26x, which is up from an earlier 21x based on the estimates for 2025. This adjustment aligns Meta closer with the “Magnificent-7” tech groups that has an average P/E ratio of about 26.6x.

This re-rating comes after Meta’s sustained leadership in online advertising, growing investments in AI infrastructure, and resilient monetization across the board. The company’s gross margins continue to be superb at 82%, and higher earnings estimates by 10 analysts suggest that there is a consensus change in the direction of a more bullish view.

Persisting Risks

Although the new target suggests firm upside, HSBC warned that risk towards the downside still exists, particularly if Meta starts to lose user commitment. At worst case, decreased usage on the platforms could injure ad revenue streams, taking the stock down to a possible valuation of $679 a share. This would be a result of eroding user engagement, competitive pressure from platforms like TikTok, and regulatory pressures that might arrest growth going forward.

Q2 Ignites Analyst Optimism

Adding fuel to the optimism, Meta recently reported second-quarter earnings that surpassed Wall Street estimates. Second-quarter revenue came in at $47.5 billion, easily surpassing the expected $44 billion. The performance was one of the strongest beats in recent history for the company and provoked a string of upgraded price targets from several large firms.

Cantor Fitzgerald increased its target to $920, emphasizing on a 21% beat in EPS and 22% year over year growth in ad revenue. Rosenblatt increased its price target to a whopping $1,086, terming Q2 reports as pivotal for Meta’s 2025 forecast. Guggenheim had a Buy rating with a slightly reduced target to $875, still applauding Meta’s $20.4 billion operating income. BMO Capital and Scotiabank boosted their estimates to $710 and $685, on the basis of robust adjusted EBITDA results and top-line growth.

Meta’s Fundamentals Support the Bull Case

Meta’s shares have run up in recent years, but the HSBC upgrade and wider analyst enthusiasm reflect that there could still be plenty of room to run. The financials of the company, marked by humongous profit margins, solid ad revenue trends, and unambiguous EPS momentum, makes a good argument for a higher valuation. Risks exist around shifts in user bases and regulatory challenges, but the general view is of robust execution and strategic alignment.

Investors seeking a high-margin technology behemoth with a history of reinvention and earnings resilience may find Meta’s existing positioning deeply attractive. With Wall Street adjusting targets into four-figure territory and the stock trading at a discount to the group in relation to its growth path, the social media giant is one to keep close focus on.

This is not simply about the financials, rather this is a reset of Wall Street’s perception of Meta’s underlying business model, ad supremacy, monetized engagement, and steadily smarter infrastructure. The $900 price target might appear ambitious, but considering Meta’s growth and Q2 blowout quarters, it’s more like keeping up. Nevertheless, even giants stumble. Meta’s greatest nemesis isn’t competition, rather it is contentment. If user consumption decays or rapidly redirects towards newer platforms, the revenue engine can stagnate, particularly with AI-based ad models becoming the new standard.

However, Meta’s transformation into a durable, high-margin machine with bold monetization and solid fundamentals makes it difficult to go against it. Investors should not be wondering if Meta can reach $900, rather they should focus about when. In an era where hype undermines results, Meta’s recent figures speak volumes, and this valuation is being led by substance and not speculation.