Bank of America analyst Justin Post has raised its price target on Meta Platforms (META) to $835 from $820 following the company's strong Q1 2026 earnings report released on April 29, 2026. The article notes that while shares dipped 8% to 9% post-earnings and are down more than 7% year to date as of May 1, 2026, Bank of America maintains a buy rating due to the resilience of Meta's core advertising business and its potential in artificial intelligence. Meta posted GAAP EPS of $10.44, significantly beating estimates by $3.78, while revenue surged 33.1% year over year to $56.31 billion, driven primarily by a 33% increase in ad sales to $55 billion and a 34% rise in Family of Apps sales to $55.9 billion. The company guided for Q2 sales between $58 billion and $61 billion with a midpoint of $59.5 billion and kept its full-year expense forecast at $162 billion to $169 billion, while lifting capital expenditure (capex) guidance to $125 billion to $145 billion. Despite the overall positive performance in earnings, Wall Street attention is largely focused on Meta's aggressive spending on AI infrastructure, which has led to mixed reactions from other major analysts who have recently cut their price targets. While Bank of America sees value in Meta's trajectory with projected 2026 revenue of $254.6 billion and 2027 revenue of $311.3 billion, competitors such as JPMorgan, UBS, TD Cowen, Bernstein, Truist, and Guggenheim have all lowered their price targets for Meta in recent periods. Bank of America analysts argue that AI-driven gains are already translating into the primary advertising engine, expecting deeper large language model (LLM) integration to improve ad performance and attract incremental spending, while also noting new monetization channels through Threads, Meta AI, Marketplace, messaging, and subscriptions. Furthermore, BofA raised its 2026 EPS estimate to $34.12 and the 2027 estimate to $34.46, viewing the massive AI buildout as a strategic investment rather than a liability, citing an attractive valuation at approximately 18 times revised 2027 GAAP EPS compared to a historical average of 21 times. The article highlights several risks associated with Bank of America's bullish outlook, primarily centering on Meta's substantial capital expenditure and reduced financial flexibility. Meta's capex-to-operating-cash-flow ratio has reached 0.59, which is 48% higher than its 10-year median of 0.40, indicating that the company's heavy investment in AI infrastructure and data centers raises the bar for future returns. This asset-heavy business model means that Meta derives roughly 98% of its sales from digital ads while simultaneously facing fixed cost increases due to AI expansion, leading to a trading price at 5.72 times forward book value—201% higher than the sector median. Consequently, analysts warn that any macroeconomic slowdown reducing ad spending could significantly impact margins if the company cannot justify the high capital outlay. Additionally, the summary points to challenges such as Reality Labs posting a loss of $4.03 billion, sequential declines in daily active users due to internet disruptions in Iran and WhatsApp restrictions in Russia, and growing competition as key factors that could influence Meta's long-term profitability despite its current execution strengths.