The Zacks Analyst Blog Meta, NVIDIA, Alphabet and Snap

For Immediate Releases

Chicago, IL – February 20, 2026 – Zacks.com announces the list of stocks featured in the Analyst Blog. Every day the Zacks Equity Research analysts discuss the latest news and events impacting stocks and the financial markets. Stocks recently featured in the blog include  Meta Platforms META, NVIDIA NVDA, Alphabet GOOGL and Snap SNAP.

Here are highlights from Friday’s Analyst Blog:

Meta Platforms Taps NVIDIA for AI Expansion: Buy or Hold Meta Stock?

Meta Platforms is expanding its AI footprint through its latest partnership with NVIDIA. The multi-year deal will support META’s build-out of data centers optimized for AI training and inference, as well as its core business. Meta Platforms is integrating AI with industrial-scale infrastructure to build the world’s largest personalization and recommendation systems for the company’s 3.58 billion users.

The NVIDIA deal supports META’s AI-related endeavors. The company is also adopting NVIDIA Confidential Computing for WhatsApp private messaging and the NVIDIA Spectrum-X Ethernet networking platform across its infrastructure footprint.

So, does META’s AI expansion strategy make the stock attractive for investors? Let’s find out.

META’s AI Integration Boosts User & Advertiser Engagements

META’s focus on integrating AI into its platforms — Facebook, WhatsApp, Instagram, Messenger and Threads — is driving user as well as advertising engagements. AI is heavily dependent on data, of which META has a trove, driven by its more than 3.58 billion daily users, including 2 billion daily actives each on Facebook and WhatsApp. Time spent across platforms is expected to benefit from Meta Platforms’ continuous ranking optimizations.

AI recommendations that deliver higher quality and more relevant content are expected to drive engagement. The company is using Meta AI to boost user experience. In the fourth quarter of 2025, within Meta AI, the number of daily actives generating media tripled year over year. The company expects to advance the capabilities of META’s underlying media generation models and ship new features to further enhance the product experience in 2026. Focus on expanding personalization on Meta AI is expected to help the company understand user interests and preferences as well as identify the most relevant content across META platform. The company has started testing Meta AI business assistant with advertisers, which helps with tasks like campaign optimization and account support.

Beyond improvements to its recommendation systems, Meta Platforms expects to use the models developed by Meta Superintelligence Labs to deliver compelling and differentiated AI products. The ad business is benefiting from an improved AI ranking system. The company has a strong pipeline of ad supply opportunities on both Threads and WhatsApp Status over the long term. Ads are now running globally in Feed on Threads, and META plans to optimize the ad formats and performance before increasing supply. The company has extended its Andromeda ads retrieval engine so it can now run on NVIDIA, AMD and MTIA.

Meta Platforms is spending heavily on AI research, models and infrastructure. The company now expects 2026 capital spending between $115 billion and $135 billion. Per CNBC, Alphabet, Meta Platforms, Amazon and Microsoft on a combined basis are expected to spend roughly $700 billion on developing AI infrastructure in 2026.

Although these investments are expected to boost META’s prospects over the long term, a challenging macroeconomic environment, regulatory issues (in the European Union and the United States) and stiff competition in the ad market from the likes of Alphabet, Amazon, Snap, TikTok, among others, is expected to drag down META’s share price in the near term. Higher capital spending is also expected to squeeze free cash flow.

Meta Platforms shares have dropped 7.4% in the trailing 12-month period, underperforming the broader Zacks Computer & Technology sector’s appreciation of 27.6% and Alphabet’s return of 64.4%. Shares of Microsoft, Amazon and Snap have dropped 3.9%, 8.1%, and 54.7% over the same timeframe.

Meanwhile, META shares are overvalued, as suggested by the Value Score of C. In terms of the forward 12-month price/sales (P/S), META is trading at 6.42X, a premium compared with the Internet Software industry’s 3.86X and Snap's 1.21X.

The Zacks Consensus Estimate for 2026 earnings is pegged at $29.67 per share, down 3.2% over the past 30 days, suggesting 26.3% growth from the figure reported in 2025. The consensus mark for 2026 revenues is pegged at $247.15 billion, suggesting 23% growth over 2025’s reported figure.

Here’s Why You Should Hold META Shares Now

Meta Platforms is spending heavily on expanding AI infrastructure, which is expected to squeeze free cash flow. Aggressive spending with 2026 operating expenses expected between $162-$169 billion is expected to hurt earnings prospects in the near term. This, along with stiff competition in the ad market and a stretched valuation, is a headwind for prospective investors.

However, META’s improved recommendation system is driving up user engagement. AI usage is making the company a popular name among advertisers. Meta Platforms now expects to invest significantly more over the next few years in developing more advanced models and the largest AI services in the world. This bodes well for investors already holding the stock.

META currently has a Zacks Rank #3 (Hold), which implies that investors should wait for a more favorable entry point to accumulate the stock. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

Why Haven't You Looked at Zacks' Top Stocks?

Since 2000, our top stock-picking strategies have blown away the S&P's +7.7% average gain per year. Amazingly, they soared with average gains of +48.4%, +50.2% and +56.7% per year.

Today you can access their live picks without cost or obligation.

See Stocks Free >>

Note: Sheraz Mian heads the Zacks Equity Research department and is a well-regarded expert of aggregate earnings. He is frequently quoted in the print and electronic media and publishes the weekly Earnings Trends and Earnings Previewreports. If you want an email notification each time Sheraz publishes a new article, please click here>>>

Media Contact

Zacks Investment Research

800-767-3771 ext. 9339

[email protected]                                     

https://www.zacks.com                                                 

Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance  for information about the performance numbers displayed in this press release.

Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report

This article originally published on Zacks Investment Research (zacks.com).

Zacks Investment Research