BNP Paribas Exane analyst Stefan Slowinski has downgraded Meta Platforms’ price target from $505 to $448, emphasizing concerns over the company's potential growth slowdown. As one of the few analysts bearish on Meta, Slowinski notes that investor sentiment may decline due to unique tailwinds that previously bolstered growth. Additionally, he highlights the substantial operating losses from Meta's Reality Labs division and ongoing investments in generative AI, which lack a clear path to monetization, as factors adding to the company's vulnerability in an increasingly challenging market due to geopolitical risks.
We believe investor sentiment could sour over the coming quarters as it becomes increasingly evident that Meta's recent growth was aided by several unique tailwinds.
Reality Labs has amassed nearly $70 billion of cumulative operating losses and the company is now also investing heavily into Gen AI infrastructure and with no clear monetization path.
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