JPMorgan Lifts Meta to $820 as Muse Reaches Number Three

Meta Platforms (META) trades at a 16% discount to its 52-week high, with an 11.3x operating cash flow multiple. The company reported 28% revenue growth and 57.1% operating cash flow conversion. However, its valuation is impacted by significant capital expenditures, with $31.1 billion spent in Q2 2026. Management expects 2026 capex to range from $130 billion to $145 billion, matching trailing twelve-month operating cash flow. Legal risks and high spending levels are noted.

Meta Platforms (META) received an overweight rating from JPMorgan analysts, citing its potential to drive AI adoption. The company launched the Muse app, which offers automated features. META stock saw a slight increase in trading.

S&P 500 and Nasdaq futures fell slightly after August PPI data showed a 5.4% annual rise, higher than estimates. Oil prices rose above $100/barrel, increasing expectations of a Fed rate hike. American Eagle Outfitters shares dropped 11.87% premarket, while Apple and Meta gained. ECB rate hike expected, with market watching for dovish signals.

Meta's shares rose 6% after introducing Muse, an AI agent. ServiceTitan's stock dropped 30% despite beating earnings due to lower guidance. Navan's revenue grew 35%, but expenses rose faster, causing a 17% decline. Cloudflare's stock surged 10.5% after launching an AI-driven cybersecurity service. American Eagle's earnings were boosted by tariff refunds, but shares fell 10% after hours. Signet Jewelers raised guidance and announced buybacks, while CooperCompanies faced softer forward expectation

JPMorgan upgraded Meta (META) to 'buy' from 'neutral' and raised its price target to $820, citing the company's AI product announcements. Analyst Doug Anmuth highlighted early traction of Meta's Muse AI agent and potential future monetization. He forecasted negative free cash flow in 2027-2028 due to increased compute demand, but noted potential AI-driven improvements in advertising.

JPMorgan upgraded Meta Platforms to Overweight, raising its price target to $820 from $640. Analyst Doug Anmuth cited Meta's AI advancements, including Muse AI agent and Meta Model API, as new growth drivers. He expects further opportunities from upcoming AI models and rising capital spending, projecting $243B and $284B in capex for 2027 and 2028, respectively. Meta shares are up 20% from recent lows but flat year-to-date.