Meta Platforms jumped 5% on Thursday, outperforming broader indices after Jefferies analysts reiterated a Buy rating and highlighted the stock’s valuation discount relative to peers. The brokerage noted that Meta trades at roughly 20 times forward earnings, well below the average 25-times multiple of other large-cap technology companies. This valuation gap, combined with stronger-than-expected advertising revenue growth—reported at 26% year-over-year in Q3—has attracted renewed investor interest in the social-media giant’s shares.

On January 22, Jefferies analysts set a price target implying more than 40% upside, citing Meta’s commitment to rein in capital expenditures on its Reality Labs metaverse unit. After scaling back budget plans, the company signaled that it expects to allocate approximately $70–72 billion to capex in 2025, versus prior guidance above $80 billion. This disciplined approach, coupled with a rebound in core advertising margins to over 45% in the last quarter, underpins the bullish price objective.

Meta confirmed it will begin global advertising on its Threads platform next week, expanding beyond initial tests in select markets. Threads, which attracted over 400 million monthly active users since its July 2023 launch, is expected to contribute incremental ad sales of $1.5–2 billion in its first full year of monetization. Management views this initiative as a key lever to diversify its revenue base amid slowing user growth on legacy apps.

Chief Technology Officer Andrew Bosworth revealed at the World Economic Forum in Davos that Meta’s Superintelligence Labs team has completed its first internally developed AI models after six months of work. Early tests show the models matching or exceeding performance benchmarks set by external providers, paving the way for tighter integration of text, image and video capabilities across Meta’s family of products. Bosworth indicated that full consumer deployment is slated for the second quarter, potentially boosting engagement metrics and advertising yield.