Morgan Stanley Doubles Down: META Stock a Must-Buy as $5B Revenue Boom Looms

Wall Street's bullish case for Meta just got a steroid injection. Morgan Stanley reaffirms its Buy rating as the social media giant's untapped $5 billion revenue stream comes into focus.

The AI Cash Machine

Meta's aggressive pivot to AI-driven ad tools and metaverse infrastructure is finally showing up on analysts' spreadsheets. That $5B opportunity? It's not vaporware—it's the floor.

Street Cred at Stake

While other firms waffle on tech valuations, Morgan Stanley's holding firm. Their thesis? Meta's got the data moat and Zuckerberg's infamous 'move fast' mentality to monetize what rivals are still whiteboarding.

The Fine Print

Of course, this assumes Meta avoids another privacy scandal or metaverse money pit. But hey—since when did existential risks stop Wall Street from chasing growth? Another day, another price target hike.

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Morgan Stanley’s latest note follows Meta’s recent announcement to introduce ads in WhatsApp’s Updates tab. The MOVE is part of a broader strategy aimed at supporting business and creator growth on the platform without disrupting the core user experience.

Morgan Stanley Sees Huge Potential in WhatsApp Ads

Morgan Stanley estimates that allowing businesses to place ads in WhatsApp’s Updates tab could generate $3 billion to $5 billion in annual revenue by 2027 and potentially up to $6 billion in an optimistic scenario. Meanwhile, the firm acknowledged that while WhatsApp’s 1.5 billion user base is impressive, about 95% of those users are located outside the U.S., where ad monetization rates are generally lower.

Still, analysts believe Meta’s massive scale and strong advertising infrastructure could support a $3–$5 billion revenue stream from WhatsApp. Their projections are based on the assumption that the Updates tab accounts for a small but meaningful portion of user engagement, roughly 2 to 4 minutes daily.

In a more optimistic scenario, Morgan Stanley envisions users spending around 12% of their time on the Updates tab, with ad monetization matching Facebook’s levels. This could generate over $6 billion in annual revenue, potentially boosting Meta’s top line by around 3% based on the firm’s existing projections.

Meta’s Strong Foothold in Advertising

Meta, unsurprisingly, continues to dominate the digital advertising landscape. While its ventures outside advertising have delivered mixed results, ads remain the company’s financial backbone, accounting for approximately 98% of total revenue in Q1 2025.

Building on this strength, analyst Brian Nowak and his team view WhatsApp ads as a promising multi-year opportunity. They emphasized Meta’s ability to harness its massive user base and ad tech to generate long-term, durable free cash FLOW growth.

Is META a Good Stock to Buy?

On TipRanks, META stock has a consensus Strong Buy rating among 46 Wall Street analysts. That rating is based on 42 Buys, three Holds, and one Sell assigned in the last three months. The average META price target of $707.16 implies a 1.64% upside from current levels.