JPMorgan Names Meta Stock (META) Among Top Internet Picks for Tough Times

JPMorgan Names Meta Stock (META) Among Top Internet Picks for Tough Times

  • 19.03.2025 04:48
  • markets.businessinsider.com
  • Keywords: AI, Market Growth

JPMorgan named Meta and Spotify as top internet picks despite tough economic conditions, maintaining Buy ratings but noting META fell 4% and SPOT dropped 4.6%.

Meta NewsMeta ServicesJPM/PJsentiment_satisfiedMETAsentiment_satisfiedSPOTsentiment_satisfied
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Estimated market influence

JPMorgan

Positivesentiment_satisfied
Analyst rating: —

Reiterated Buy rating on META stock with a price target of $725, expecting growth driven by AI and core improvements.

Meta Platforms

Meta Platforms

Positivesentiment_satisfied
Analyst rating: Strong buy

Highlighted as top pick due to AI dominance, upcoming Llama 4 launch, and strong advertiser base; expected revenue growth from AI-driven optimizations and video unification efforts.

Spotify Technology

Spotify Technology

Positivesentiment_satisfied
Analyst rating: Buy

Identified as equally good stock in internet sector; Buy rating maintained with expectations of accelerated execution and revenue growth.

Context

Analysis of JPMorgan's Top Picks in the Internet Sector

Key Highlights

  • JPMorgan's Rating on META Stock: Reiterated "Buy" rating with a price target of $725, implying a 25% growth potential from current levels.
  • Stock Performance: Despite positive ratings, META stock fell nearly 4%, while SPOT stock dropped 4.6%.
  • AI Dominance: Meta's leadership in AI, particularly the upcoming Llama 4 launch, is highlighted as a key driver of future growth.
  • Advertiser Base: Meta has tens of millions of advertisers, with over 80% of ad revenue coming from performance and direct response advertising.
  • Spotify Growth Outlook: JPMorgan forecasts 14% annual revenue growth for Spotify in 2025-2026, alongside higher profitability.

Market Insights

  • The internet sector is facing macroeconomic challenges, but both Meta and Spotify are seen as well-equipped to navigate potential downturns.
  • AI-driven optimizations and core improvements (e.g., Reels and Click-to-Message ads) are expected to fuel Meta's 2025 revenue growth.
  • Spotify's investments in user engagement and monetization are expected to justify its premium valuation.

Competitive Dynamics

  • Meta's Strategic Advantage: Its massive advertiser base and AI leadership position it as a top pick for investors seeking long-term growth.
  • Spotify's Execution: The bank believes 2025 will be pivotal for Spotify, with accelerated execution across its services driving long-term monetization.

Long-Term Growth

  • Meta's open-sourcing of AI models is seen as a key strategy to ensure global access to AI benefits, advancing its mission.
  • Llama 4 is expected to play a significant role in powering AI agents with advanced reasoning capabilities.

Related Stocks Performance

| Name | Price | +/- |------|-------|----- | Stock A | $237.11 | 5.15% | | Stock B | $215.29 | 1.16% | | Stock C | $388.42 | 1.28% | | Stock D | $961.54 | 3.34% | | Stock E | $586.00 | 2.95% |

Conclusion

JPMorgan's ratings reflect confidence in Meta and Spotify's ability to thrive in challenging economic conditions, driven by AI innovation and strategic execution. However, the short-term stock drops suggest market uncertainty or investor caution.