Meta shares rocket 23%, one of the best days in over a decade

Key Points
  • Meta shares rallied more than 23% and saw a rapid-fire set of analyst upgrades.
  • Commentary from CEO Mark Zuckerberg, combined with a revenue beat, sent shares soaring and analysts enthusing about trimmed costs and strengthening products.

In this article

Mark Zuckerberg told the world in October 2021 that he was rebranding Facebook to Meta as the company pushes toward the metaverse.
Facebook | via Reuters

Meta shares jumped over 23% on Thursday, one of the stocks best day in nearly a decade, with a slew of analyst upgrades coming off the back of a fourth-quarter revenue beat and optimistic prognostications from CEO Mark Zuckerberg.

Meta shares sit at their highest point since September 2022, which was weeks before a disastrous third-quarter earnings report that prompted analysts across Wall Street to openly question Zuckerberg's leadership. There was a markedly changed tone in analyst notes Wednesday night and Thursday morning, however, with the company beating topline estimates with $32.17 billion in revenue.

"Does META Really Deserve To Be Up 20% In The After-Market?!" posited Evercore ISI analyst Mark Mahaney. In a word, Mahaney wrote, "Yes." He cited "materially reduced expense projections" and a larger-than-anticipated share buyback, upping his price target to $275 and reiterating an outperform rating.

Rosenblatt's Barton Crockett took his rating for Meta to a buy, setting a $220 price target and saying he was convinced by a now "enticing" valuation. At Guggenheim, Michael Morris revised his price target to $210, maintaining a buy rating, citing in part lowered costs and a belief in management messaging on "momentum."

Zuckerberg's commentary was well received by analysts, just months after the Meta co-founder took responsibility for firing thousands of workers. "Our management theme for 2023 is the 'Year of Efficiency' and we're focused on becoming a stronger and more nimble organization," he said in a statement Wednesday.

Zuckerberg, 38, has led the company's pivot toward virtual reality, sinking billions into Meta's Reality Labs vertical. It's a costly maneuver that has earned him criticism from both analysts and activist investors, including Altimeter Capital's Brad Gerstner, who sees the gambit as a distraction from the company's core ad businesses.

— CNBC's Michael Bloom and Jonathan Vanian contributed to this report.