BNP Paribas analyst Nick Jones said Meta Platforms Inc's (NASDAQ:META) latest results highlight strong operating momentum, even as higher capital spending weighs on near-term stock performance.
Strong First-Quarter Performance
Jones said Meta exceeded expectations across both revenue and earnings in the first quarter.
He noted that Family of Apps revenue reached $55.9 billion and advertising revenue came in at $55.0 billion, both above consensus estimates, while Reality Labs revenue of $402 million fell short of expectations.
He added that diluted EPS of $10.44 significantly beat consensus, supported by total expenses of $33.4 billion and capital expenditures of $19.8 billion, both below expectations.
Guidance And Higher CapEx Outlook
Jones said Meta issued second-quarter revenue guidance of $58 billion to $61 billion, broadly in line with consensus and implying about 25% year-over-year growth.
He noted that the outlook includes a modest foreign exchange tailwind, translating to roughly 23% growth at the midpoint on a constant-currency basis.
He added that Meta kept its full-year expense guidance unchanged at $162 billion to $169 billion but raised its 2026 capital expenditure outlook to $125 billion to $145 billion, up from prior guidance. This move contributed to a decline in the stock after hours.
Estimates And Long-Term View
Jones said he raised his 2026 forecasts following stronger-than-expected results and updated guidance, while making only slight revisions to 2027 estimates.
He emphasized that Meta still has significant room to improve monetization, which should support continued strong top-line growth and justify ongoing strategic investments.
He maintained an Outperform rating and a $955 price forecast, based on a 27x multiple applied to his 2027 estimated diluted EPS of $35.34.
Technical Analysis
Meta is sitting in the lower half of its 52-week range after failing to hold the higher levels set earlier in the year, which leans toward a more cautious intermediate trend. The stock is trading 5.2% below its 20-day simple moving average (SMA) and 5.4% below its 100-day SMA, a setup that points to sellers having the edge across both short- and mid-term timeframes.
The moving average convergence divergence (MACD), a trend/momentum measure, remains above its signal line, and the histogram is positive, suggesting downside momentum may be easing even as price pulls back. When MACD remains bullish during a drop, it often reflects dip-buying interest seeking to stabilize the trend.
The 50-day SMA remains below the 200-day SMA following the death cross in December 2025, which keeps a longer-term "repair" narrative in place. With the stock also trading 10.2% below its 200-day SMA, rallies may need to prove themselves before the longer-term trend looks clean again.
- Key Resistance: $673.00 — an area where prior rallies have tended to stall.
- Key Support: $520.50 — a level where buyers have previously stepped in near the lows.
Top ETF Exposure
- Capital Group Growth ETF (NYSE:CGGR): 8.09% Weight
- First Trust Dow Jones Internet Index Fund (NYSE:FDN): 9.17% Weight
- Natixis Loomis Sayles Focused Growth ETF (NYSE:LSGR): 8.65% Weight
Significance: Because META carries such a heavy weight in these funds, any significant inflows or outflows will likely trigger automatic buying or selling of the stock.
META Price Action: Meta Platforms shares were down 7.99% at $615.67 at the time of publication on Thursday, according to Benzinga Pro data.
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