Is Meta Platforms Stock Going to $700 by Year-End? The Math Says It's Possible.

Meta Platforms (NASDAQ: META) doesn't need to convince investors that it has been a top performer. The numbers prove it. In the past decade, this social media stock has climbed 461% (as of Mar. 13). It is one of the most valuable companies on the face of the planet today, with a market cap of $1.6 trillion.

Don't think that the momentum is over. There is still a reason to be bullish. Are Meta Platforms shares going to $700 by the end of the year? The math says it's possible.

Image source: The Motley Fool.

Investors should expect muted profit growth

Between 2020 and 2025, Meta's operating income increased at a compound annual rate of 21%. I don't think it's unreasonable to assume that this stellar pace of growth will decelerate this year. It might prove to be a worrying development for investors who are caught off guard.

That's because the leadership team expects Meta's costs and expenses to rise 41% year over year to $165.5 billion (at the midpoint) in 2026. This represents a notable acceleration from the 24% increase in 2025.

Given that sell-side analysts believe Meta's revenue will rise by 25% this year, an impressive leap at this scale, it looks as if there will be margin compression. That makes sense because the business has been spending a lot of money to bring in top-notch talent to pursue its artificial intelligence (AI) strategy, which isn't cheap. There are also the significant depreciation and amortization charges it has to report from its massive capital expenditures.

Combine 25% revenue growth with a 41% jump in costs and expenses, and Meta's operating income is set to increase by just 3% in 2026, leading to an operating margin of 34%. That's down from 41% in 2025 and 48% in 2024. This trend is worth paying attention to.

Valuation can play a role as well

Profit growth isn't going to move the needle by much, if these forecasts prove to be correct. But investors shouldn't ignore valuation. Favorable market sentiment can boost stock prices in short order.

Right now, Meta shares trade at an enterprise value-to-earnings before interest and taxes (EV/EBIT) ratio of 19.4. In the past 12 months, the EV/EBIT multiple has averaged 21.4. Assuming the valuation gets back to its trailing one-year mean before 2026 comes to a close, then there's an additional 10% of upside that needs to be factored into this exercise.

Combined with the 3% gain from higher operating income, Meta's stock price could rise in the ballpark of 14% to approach $700 by year-end. If the financials are better than anticipated this year and investor enthusiasm grows, then shares could exceed these expectations.

Neil Patel has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Meta Platforms. The Motley Fool has a disclosure policy.