Truist Securities reduced its price target on Meta Platforms Inc. to US$763 from US$770, maintaining a buy rating following the company’s US$18bn settlement addressing allegations of harm to adolescents.
The agreement, finalized with 52 state attorneys general from 48 U.S. states, resolves claims that Facebook and Instagram failed to adequately protect children and contributed to social media addiction. The total settlement value is structured as US$11.66bn in guaranteed payments over 10 years, with an additional US$5.02bn in contingent payments possible based on future conditions.
A separate clause ties an additional US$5.3bn payment to whether competitors TikTok and YouTube adopt comparable safety measures and contribute an equivalent amount to the settlement. Truist noted that adolescents represent less than 1% of Meta’s revenue and that users under 18 spend roughly one hour per day on Instagram, below the two-hour daily limit set in the agreement.
Meta’s stock closed at US$576.14 on August 26, up 1.07% or US$6.09. Truist’s revised target remains above the closing price, though it trails other analyst projections. BMO Capital maintained a market-perform rating with a US$580 target, while Evercore ISI kept an outperform rating with a US$860 target. BofA Securities reiterated a buy rating with a US$810 target.
Regulatory scrutiny continues. The European Commission is reviewing Meta for potential violations of the Digital Services Act related to addictive design features on Facebook and Instagram. Separately, Meta introduced enhanced security features for WhatsApp, including a full PIN/password system for two-step verification to bolster account protection.
