Meta Platforms (Meta (META)) shares climbed more than 1% on Tuesday, defying a weaker broader market. The Nasdaq fell more than 1%, and the S&P 500 slipped 0.31%, but Meta managed to eke out a gain as analyst sentiment turned more upbeat.

The move came after Erste Group upgraded the stock to Buy from Hold, and BNP Paribas reiterated its Outperform rating ahead of Meta's second-quarter earnings, expected in the last week of July. Investors are increasingly optimistic about Meta's long-term artificial intelligence monetization strategy, even as the company spends heavily on AI infrastructure.

BNP Paribas senior analyst Nick Jones said Meta remains well-positioned to sustain revenue growth despite rising AI spending. He also sees a potential future cloud offering as an additional long-term growth opportunity. "Meta's valuation suggests investors remain cautious about earnings growth, the scale of AI investments, returns on those investments, competition in AI, and the broader macro environment," Jones noted. But he believes the company can maintain its top-line momentum.

Analyst Outlook Ahead of Earnings

BNP Paribas reiterated its Outperform rating and $955 price forecast on Meta. Jones said investors are likely to focus on Meta's capital spending plans, AI product development, a potential cloud offering, and subscription adoption trends when the company reports earnings. He expects second-quarter revenue growth to slow from prior quarters due to temporary factors, but sees long-term momentum intact.

Revenue and Earnings Expectations

Jones said investors are expecting second-quarter revenue growth of 27% to 29% year over year, compared with the consensus estimate of 27%. He also expects GAAP diluted earnings per share above $7.40, versus the Street consensus of $7.19. For the third quarter, BNP Paribas believes investors are looking for revenue guidance of $62 billion to $64 billion, compared with the consensus estimate of $63.2 billion.

AI Spending Remains in Focus

The analyst also expects Meta to raise its 2026 capital expenditure outlook by at least $10 billion from its current $125 billion to $145 billion range, as higher component costs continue to inflate AI infrastructure spending. Despite slowing user growth as Meta's platforms approach saturation, BNP Paribas said engagement remains a key strength. The firm estimates Meta accounts for more than 40% of time spent across major social media platforms, nearly double that of its next-largest competitor. That, it said, should support continued growth in revenue per daily active person.

BNP Paribas expects Meta to fund its elevated AI investments through stronger monetization of AI features, advertising market share gains, subscription revenue, and the optionality of a future cloud offering.

Meta Platforms Technical Analysis

Meta is trading about 5.4% above its 20-day simple moving average and slightly above its 50-day moving average. However, the stock remains below both its 100-day and 200-day moving averages, suggesting the longer-term trend has yet to turn positive. Momentum indicators have improved. The moving average convergence divergence (MACD) remains above its signal line, indicating selling pressure has eased. Even so, the broader trend remains cautious. The 20-day moving average is still below the 50-day average, while the 50-day average remains below the 200-day average following a death cross that formed in December 2025. Technical analysts are watching resistance near $643, close to the 200-day moving average. Initial support sits around $595 near the 50-day moving average.

Earnings Remain the Next Major Catalyst

Attention is now shifting to Meta's expected second-quarter earnings report, estimated for July 29, 2026, which could shape the stock's next move. Wall Street expects earnings per share of $7.18, up from $7.14 a year earlier. Revenue is projected to increase to $60.22 billion from $47.52 billion. The stock trades at roughly 21.8 times earnings and carries a consensus Buy rating. The average analyst price forecast stands at $826.88. Recent analyst actions include:

• Erste Group upgraded the stock to Buy on Tuesday.
• Wells Fargo maintained an Overweight rating and raised its price forecast to $767 on July 2.
• RBC Capital Markets reiterated its Outperform rating with an $810 price forecast on June 1.

Meta Platforms Price Action

Meta Platforms shares were up 1.42% at $608.83 at the time of publication on Tuesday.