Meta Rallies as Wells Fargo Lifts Target to $796 Ahead of Connect Keynote

Wells Fargo lifted its Meta target to USD 796, citing AI progress ahead of Meta Connect, as the stock gained 5.2% to EUR 609.50.

Shares of Meta Platforms climbed 5.2% to EUR 609.50 on Tuesday, powered by a fresh price-target hike from Wells Fargo that reinforced the stock's standing among Wall Street bulls just as the company's flagship developer event gets underway.

Wells Fargo raised its target to USD 796 while keeping an "Overweight" rating, pointing to Meta's strides in artificial intelligence and the traction of its Muse AI assistant in the run-up to the Meta Connect conference. The call is the latest in a string of upbeat analyst notes. On September 10, JPMorgan's Doug Anmuth upgraded the stock from Neutral to Overweight with a USD 820 target, arguing that the personal AI agent Muse and new foundation models could unlock growth avenues beyond Meta's core advertising business. Citi, for its part, reiterated a buy recommendation and a USD 800 target, with analyst Ronald Josey citing upcoming catalysts tied to the conference.

Spotlight on Menlo Park

Meta Connect kicks off Wednesday at the company's Menlo Park campus, and market participants will be watching closely for concrete usage metrics. Wells Fargo expects investors to scrutinize CEO Mark Zuckerberg's keynote on September 23 for updates on the newest AI models and hardware initiatives such as AI glasses. The agenda also features presentations on the further development of Muse, new iterations of the camera-equipped smart glasses, and fresh mixed-reality hardware.

Meta unveiled the autonomous Muse assistant in early September. Built on the Muse Spark model, it can independently handle tasks such as drafting messages or booking travel. The technology is set to roll out gradually to wearable devices and forms the centerpiece of the company's current product offensive.

Infrastructure Push and a Transoceanic Cable

Alongside its software rollouts, Meta is expanding its technical backbone. The company announced Project Petal on Tuesday—a transoceanic subsea cable with a transmission capacity of one petabit per second. Spanning roughly 7,000 kilometers between France and the United States, the link is slated to go live in 2029. Meta is partnering with Orange, NEC, and Sumitomo Electric Industries to double the capacity of existing top-tier cables without a proportional increase in power consumption.

Earlier this month, it also emerged that Meta plans to deploy its own AI chips. The MTIA 450 processor is scheduled for installation in the company's data centers in the first half of 2027, aimed at cutting costs and energy use.

New Subscription Revenue and a Cash Dividend

Beyond advertising, Meta is cultivating additional revenue streams. Roughly a week ago, it launched the paid Meta One model with four pricing tiers for advanced AI and creative tools—a service the company says has already logged 15 million subscriptions and trial phases. Shareholders, meanwhile, are benefiting from the ex-dividend date on a cash payout of USD 0.525 per share, with payment scheduled for September 28.

Legal Front: Ofcom Challenge and a Frankfurt Ruling

Away from the product news, Meta is going on the offensive on the legal front. The US group has lodged complaints with British courts against decisions by media regulator Ofcom, contesting the classification of WhatsApp and Instagram under the strictest category of the UK's Online Safety Act. At issue is the so-called Category 1 designation, which obliges operators to take additional measures on user transparency, control mechanisms, action against fraudulent ads, and reporting of illegal content.

Meta contends that such obligations were not designed for private communication services like WhatsApp. A spokesperson said the company is challenging specific aspects of the implementation, not the law itself. Violations can carry penalties of up to 10% of relevant global revenue or up to GBP 18 million. Meta is also pushing back against the regulator's fee assessment, which is based on worldwide group revenue. Competitors including Roblox and Quora have launched similar legal challenges. UK Digital Minister Lisa Nandy said in light of the disputes that the government would present legislative updates more frequently and take a more interventionist approach.

That fraudulent advertising can carry legal consequences was underscored in mid-September by a ruling from the Frankfurt am Main regional court. The civil chamber granted a plaintiff injunctive and disclosure claims over deceptive ads, finding that the company's algorithmic advertising system constitutes editorial control. The ruling is not yet final.

Valuation Gap and the Road Ahead

Despite the recent gains, the stock trades on European venues 8.6% below its 52-week high of EUR 666.70. The shares had come off a strong recovery phase on a softer note at the end of last week, closing Friday at EUR 579.70 for a daily loss of 2.5%, which left the value roughly 13% under that same 52-week peak. Investors now await whether Wednesday's hardware and AI unveilings can supply the spark for the next breakout.