The Street is getting more bullish on Meta stock as Muse’s rapid adoption strengthens the case for new consumer AI revenue streams and faster medium-term earnings growth.
- Cantor raised Meta’s target, saying Muse has several potential paths to a profitable freemium model.
- KeyBanc lifted its target to $900 from $780, citing “multiple paths to drive revenue growth” and potential multiple expansion.
- Muse surpassed 500,000 users, 250,000 daily active users and 2 million prompts in its first week, according to The Information.
Meta Platforms Inc. (META) drew two sizable price-target hikes Wednesday as analysts pointed to its fast-growing Muse personal AI agent as a potential new source of revenue and earnings growth beyond the company’s core advertising business.
Cantor Fitzgerald raised its target on META stock to $860 from $680 and maintained an ‘Overweight’ rating, saying personal AI agents could emerge as the “third S-curve” in AI as the technology becomes more capable, according to TheFly.
The firm believes Meta is well-positioned to be a leading beneficiary of that shift, arguing that Muse has a “competitive model” trained to excel at agentic tasks.
Cantor analyst acknowledged that Muse’s unit economics are being subsidized during its early rollout, according to TheFly, but said Meta has “several paths to a profitable freemium model.”
KeyBanc Sees Faster Revenue And Earnings Growth
KeyBanc analyst Justin Patterson was more bullish, raising his Meta target to $900 from $780 while keeping an ‘Overweight’ rating. Per TheFly, the firm said Muse’s momentum reinforces its view that sentiment toward consumer AI is positioned to improve.
More importantly for Meta’s financial outlook, KeyBanc believes the company now has “multiple paths to drive revenue growth.” The firm expects Meta’s product innovation to support faster medium-term revenue and earnings growth, which could also support expansion in the stock’s valuation multiple.
Meta stock traded marginally lower in Wednesday’s premarket. Based on its previous close of $736.59, Cantor’s $860 target sits roughly 17% higher, while KeyBanc’s $900 target is about 22% above that level.
Muse Buzz Builds Quickly
Muse was launched on Sept. 8 as what Meta describes as a personal AI agent that can work across websites and services, handle longer-running projects, and carry out actions such as email, travel planning, and shopping.
Early adoption has been rapid. The Information reported that Muse surpassed 500,000 total users and 250,000 daily active users in its first week, with users submitting more than two million prompts.
It had climbed to the top of U.S. app rankings as analysts increasingly considered whether it could become a meaningful new revenue engine for Meta.
Meta is already experimenting with expanding the agent's capabilities. Reuters reported that the company is testing a “human concierge” in which contractors can handle some calls placed through Muse. Meta said the test is intended to help it learn how to improve the feature’s safety and privacy before a broader release.
Retail Sentiment Around META Stock
On Stocktwits, retail sentiment around META stock remained ‘bullish’ amid high message volume. At the time of this writing, the stock was marginally in the red in Wednesday’s premarket trade.
In the last five days, Meta shares have surged by around 10%, making them the best-performing Mag 7 stock.
So far this year, the stock has risen over 13%. In comparison, the Vanguard Morningstar Growth ETF (VUG) and Roundhill Magnificent Seven ETF (MAGS), which hold META stock, have risen around 12% and 11%, respectively, over the same period.
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