Prediction: Meta Stock Reclaims Its All-Time High Before 2029.

Meta Platforms (NASDAQ:META) stock peaked more than a year ago. The record close of $790.00 came on Aug. 12, 2025 (shares briefly traded as high as $796.25 three days later), and the stock, trading for about $579 as of this writing, sits about 27% below that mark.

In between came an expensive year: capital spending plans that kept climbing, a quarter of falling earnings, and a landmark legal settlement.

Here's my prediction anyway. Meta stock closes above that record before 2029.

That call doesn't require the stock's price-to-earnings ratio to rise. Getting back to the record by the end of 2028 requires about 36% appreciation, which works out to about 14% a year. And Meta's core business is already growing considerably faster than that.

Image source: Getty Images.

The ads business is still compounding fast

Whatever the stock has done, the advertising business is still compounding fast. Meta's second-quarter revenue rose 28% year over year to $60.8 billion, or 27% on a constant-currency basis. That's a step down from the first quarter's 33% growth, but volume and pricing are both still climbing. Ad impressions increased 14% year over year, while the average price per ad rose 12%. The company's apps now reach 3.60 billion daily active people, up 3%.

Why is the stock down, then? Because the bottom line hasn't kept up.

Costs and expenses in the second quarter jumped 55% year over year to $42.0 billion, dragging its operating margin down to 31% from 43% a year earlier. Diluted earnings per share fell 13% to $6.18.

To be fair, the quarter absorbed $2.4 billion of charges tied to legal proceedings and $1.18 billion of severance from a May headcount reduction -- about $3.6 billion of items that shouldn't repeat. The more durable weight is the build-out itself. Meta expects 2026 capital expenditures of $130 billion to $145 billion for artificial intelligence (AI) and its core business, a range whose floor it raised in July.

Then, last week, Meta agreed to pay up to $16.7 billion to settle claims from a coalition of state attorneys general that it misled the public about its apps' harms to teenagers, plus a separate $1 billion agreement with Texas. It has been a long time since this company gave the market an uncomplicated quarter.

The math, at today's multiple

Still, the prediction doesn't need an uncomplicated quarter. It needs math. Shares trade at a forward price-to-earnings ratio of about 17, based on expected 2027 earnings. For the stock to sit at $790.00 at that same valuation multiple, the earnings the market is pricing in would need to be about 36% higher than today's -- mid-teens annual earnings growth between now and the end of 2028. No multiple expansion required.

For a business growing revenue 28%, that could prove a modest ask.

One more charge comes first, though: Meta says it expects to book about $10 billion of legal expense in the third quarter to cover the settlement, a cost it hadn't built into its prior outlook. But charges like that end. The settlement converts an open-ended legal risk into a mostly known number -- about $12.7 billion of a roughly $18 billion package going to the states over 10 years, with the remaining $5.3 billion contingent on rival platforms accepting similar terms. And the severance reflects a company cutting headcount while revenue compounds -- the reported 75,472 still counts about 8,000 people cut in May, most of them gone by the end of this quarter.

The spending has to pay off

The honest risk to this forecast is the same thing that knocked the stock down in the first place. Capital spending of $130 billion to $145 billion this year becomes depreciation for years afterward, and depreciation lands directly on the earnings line.

If total expenses keep growing anywhere near 55% while revenue grows 28%, earnings won't compound in the mid-teens. They'll keep shrinking, and the math above falls apart. Second-quarter free cash flow of $784 million, down from $8.5 billion a year earlier, shows how much of the profit the build-out is consuming.

But CEO Mark Zuckerberg's claim that "AI is accelerating our core business today" is showing up in the numbers, at least on the revenue line. Ad prices rising 12% while impressions grow 14% is what an effective AI advertising system looks like. The spending has a return attached, and the question is timing.

Will Meta see its record again before 2029?

I believe it will. The required return is about 14% a year, the advertising business is compounding at twice that rate, and the stock's forward price-to-earnings ratio of about 17 is a modest price for this kind of growth.

If 2027 arrives with expenses still growing twice as fast as revenue, I'd rethink the call. Until then, I'd rather own the stock.

Daniel Sparks and his clients do not have positions in any of the stocks mentioned. The Motley Fool has positions in and recommends Meta Platforms. The Motley Fool has a disclosure policy.