Citizens Asserts Market Outperform Rating on Meta Platforms Inc. (META) Buoyed by AI Strategy

Meta Platforms Inc. (NASDAQ:META) is one of the best augmented reality stocks to buy right now. On November 24, analysts at Citizens reiterated a Market Outperform rating on the stock and set a $900 price target, impressed by its artificial intelligence development.

According to the research firm, the introduction of the Segment Anything model 3 should enhance the company’s ability to understand objects within images and video. The research firm expects the technology to help the tech giant scale its data engine, enabling annotation speeds 5 times faster than those of human annotators.

Citizens expect artificial intelligence advancements to help Meta create datasets containing millions of unique concepts and enhance its content understanding capabilities. The remarks come amid reports that the company is in talks with Google over a potential multibillion-dollar deal to purchase chips for its data centers.

Meta could end up renting chips from Google Cloud to enhance its AI workloads. Google’s chips stand out for being cheaper than Nvidia’s pricey offerings.

Meta Platforms, Inc. (NASDAQ:META) develops technologies that enable people and businesses to connect across mobile devices, PCs, VR, and mixed-reality wearables, and has made substantial investments in augmented and virtual reality through its Reality Labs division. The company builds AR and MR hardware and software, including Meta Spark for creating AR effects, Ray-Ban Meta smart glasses, and Quest headsets with passthrough AR capabilities, while also developing advanced prototypes such as the Orion AR glasses, which combine a traditional eyeglass form factor with holographic displays and contextual AI. AR is just a small part of Meta’s business, making the company an AR enabler rather than a pure-play.

While we acknowledge the potential of META as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

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Disclosure: None. This article is originally published at Insider Monkey.