Piper Sandler said it is more positive about Meta Platforms' (NASDAQ:META) positioning in AI after it took a deeper look at the company's capabilities within the space.
Analysts, who have an Overweight rating and a $270 price target on the stock, told investors that the firm is also optimistic about Meta's positioning in the digital ads segment.
"We see a three-pronged approach with META using AI to (1) drive higher user engagement, (2) develop better, more automated advertiser tools, and (3) create an open-source AI ecosystem," the analysts wrote.
"Meta's investment may have been overshadowed by the Metaverse, but AI initiatives could soon catalyze revenue share gains in '23 & '24, recapturing ground lost post-ATT," they added.
Meta remains a top pick for Piper Sandler in digital advertising. The analysts also stated that the company's "1Q23 cost cuts effectively 'passed the baton' to revenue re-acceleration."