Key insights
- This analysis projects Meta's revenue, expenses, and EPS through 2026, suggesting significant revenue growth. The model estimates Q2 2026 revenue at $59.7B and forecasts a 12.63% jump for the rest of the year. Based on these projections, the author derives potential price targets using 20x and 30x PE multiples, implying substantial upside. This could positively influence market sentiment towards Meta.
You guys don't like numbers, so I'll keep it short...
Meta's been beaten down, so this'll examine it's earnings to see if it's justified, and give revenue, EPS and price targets to look out for
Expenses and Net income
First, let's look at Meta's revenue. Meta states that they're going to recieved up to $61 B in revenue for Q2, let's see what my model suggests...
| q | rev | exp | interest | tax | NI | | :-: | :-: | :-: | :-: | :-: | :-: | | q4 '25 | 59893 | 35148 | 609 | 2586 | 22768 | | q1 '26 | 56311 | 33439 | -1120 | -5021 | 26773 | | q2 '26 | 59'743 | 38'710 | 313 | 3'195 | 18'150 | | q3 '26 | 63'303 | 42'810 | 307 | 3'348 | 17'452 | | q4 '26 | 67'240 | 47'233 | 313 | 3'538 | 16'781 |
The model suggests $59.7 B for the second quarter and for rest of the year a 12.63% jump... On $60 B that's huge!
Expenses are going to take a hit, I had to bump up the numbers manually to accommodate for the increased CapEx and full year expense forecast on the earnings call.
Revenue check
Looking at their revenue again, in this section I'm going to double check that the initial values of the checksum are accurate by running the model again on their revenue sources as claimed on the balance sheet...
| Q | Ads | Other Rev | Reality Labs | Total Rev | | :-: | :-: | :-: | :-: | :-: | | Q4 '25 | 58'137 | 801 | 955 | 59'893 | | Q1 '26 | 55'024 | 885 | 402 | 56'311 | | Q2 '26 | 58'337.14 | 985.70 | 531.64 | 59'854.48 | | Q3 '26 | 61'737.58 | 1108.96 | 737.65 | 63'584.19 | | Q4 '26 | 65'472.76 | 1248.93 | 1080.91 | 67'802.61 |
The revenue numbers here are within a reasonable margin of error, so onto what you're here for, the EPS and price targets...
| q | shares | eps | ttm x 20 pe | ttm x 30 pe | | :-: | :-: | :-: | :-: | :-: | | Q1 '26 | 2'564 | 10.44 | 550.26 | 825.39 | | Q2 '26 | 2'556.48 | 7.10 | 549.42 | 824.14 | | Q3 '26 | 2'549.88 | 6.84 | 665.25 | 997.87 | | Q4 '26 | 2'543.69 | 6.60 | 619.66 | 929.50 |
For the period of time before second quarter earnings, I'm seeing values as low as 550. For the second quarter, I'm seeing values as high 825, if Meta can reclaim a 30 PE. For the later in the year, I'm targeting a price just under $1000 with a PE of 30.
Position: 100 shares @ 611; 5 short puts (Jun 12, 585 @ 8.24) ... I'll be loading up on the way down.