Hightower Advisors‘ Chief Investment Strategist Stephanie Link sold half her Meta (NASDAQ:META) position Friday, calling the company “tone-deaf” as its shares fell 5.5% following a report it is considering raising tens of billions in a stock sale to fund AI infrastructure.
Link Trims Meta Stake
“The numbers actually did go higher on the revenue line, but the operating margin numbers are going in the wrong direction — and people are not going to invest in companies where earnings are going down or at least stagnant,” Link told CNBC’s Closing Bell on Friday.
Meta executives have been exploring ways to raise cash as the company prepares to boost AI-related capex to as much as $145 billion this year and higher in 2027, the Financial Times reported, citing sources.
Meta did not immediately respond to Benzinga‘s request for comment.
Meta was already expected to spend $125-$135 billion in capex this year, up from $74 billion last year, Link said, adding the company has spent $82 billion on Reality Labs since 2021, generating $80 billion in operating losses.
“The shareholder base at Meta — they don’t want them to continue to spend like drunken sailors,” she said.
Link also stated she still holds a reduced META position, believing in the long-term story, but wants earnings estimates moving higher before adding back.
Despite trimming META, Link said on X that the AI spend cycle is “accelerating” and urged investors to build a shopping list, naming Broadcom (NASDAQ:AVGO), International Business Machines (NYSE:IBM), and Snowflake (NYSE:SNOW) as her top picks.
Analysts Split On Spending
Fundstrat‘s Tom Lee said Meta’s move wasn’t surprising, noting Google had significant success raising $45 billion in a short underwriting period. “These AI companies are building basically huge real estate infrastructures that aren’t fully funded today,” Lee told CNBC’s Closing Bell.
Meta’s rival Alphabet (NASDAQ:GOOG) (NASDAQ:GOOGL) raised $85 billion in equity this week after strong investor demand.
Trading Metrics, Technical Analysis
According to Benzinga Pro data, the stock closed Friday’s regular session at $593, down 5.51%. META shares have declined 13.38% over the past 12 months and 8.83% year-to-date.
Meta has a market capitalization of $1.51 trillion, a 52-week high of $796.25 and a 52-week low of $520.26.
The large-cap stock has dropped 13.38% over the past 12 months.
RBC Capital reiterated its Outperform rating on META with a $810 price target on Monday, implying 37.34% upside from current levels.
Benzinga's Edge Stock Rankings indicate that META is experiencing short-term upward movement along with long and medium-term consolidation.
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Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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