The third quarter earnings season for the tech giants has been a mixed bag. While some managed to impress investors with their performance and prospects, others fell short of expectations on some metrics. Wall Street remains bullish on several tech giants, thanks to the tailwinds generated by AI (artificial intelligence). Using TipRanks’ stock comparison tool, we compare Meta Platforms (META), Uber Technologies (UBER), and Amazon (AMZN) to find the “strong buy” stocks with the most upside potential, according to Wall Street analysts.
Social media giant Meta Platforms reported better-than-expected third-quarter revenue and earnings for the third quarter of 2024. The company’s top line grew 19% year-over-year to $40.5 billion, while EPS ( earnings per share) rose 37% to $6.03. .
However, the stock fell after the earnings report as investors were disappointed with Meta’s small number of users. Daily active people (DAP), which indicates the number of users who visited at least one of the familiar apps (Facebook, Instagram, Messenger and/or WhatsApp) on a given day, increased 5% to 3.29 billion, but fell behind behind the analyst consensus. of 3.31 billion.
Additionally, the company raised its capital spending guidance for 2024, and CEO Mark Zuckerberg warned investors of a significant increase in capital spending on AI infrastructure in 2025.
Following the Q3 release, Baird analyst Colin Sebastian reaffirmed a Buy rating on META stock and raised the price target to $630 from $605. The analyst believes the company’s strong third-quarter results reflect a stable macro backdrop, healthy user growth and engagement trends, and the benefits of AI in advertising products and content recommendations. Expect AI to drive further growth of meta platforms in the coming days.
Like Sebastian, most analysts are optimistic about Meta Platform’s prospects. META stock earns a Strong Buy consensus rating based on 41 Buys, three Holds, and one Sell recommendation. META stock’s average price target of $654.23 implies 11% upside potential. Shares are up 66.5% so far this year.
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Shares of Uber Technologies fell 9.3% on Oct. 31 as the company reported slower-than-expected booking growth and raised concerns among investors about the impact of macroeconomic pressures on demand in the industry. of shared trips. The company’s gross bookings grew 16% year over year to $40.97 billion, missing analysts’ estimate of $41.25 billion.
On the bright side, Uber’s third-quarter revenue rose 20% to $9.29 billion and beat estimates. The company’s earnings per share (EPS) rose to $1.20 from $0.10 in the prior-year quarter, reflecting the inclusion of a $1.7 billion benefit of unrealized gains related to the revaluation of their capital investments.
Looking ahead, Uber CEO Dara Khosrowshahi is confident in the company’s future, saying the strength of its core business supports its organic investments in new products and capabilities to drive long-term growth.
Reacting to the results, Goldman Sachs analyst Eric Sheridan reaffirmed a Buy rating on Uber Technologies shares with a $96 price target. The analyst believes that following the post-earnings pullback, UBER is the best “absolute bullish return idea” among Goldman’s large-cap coverage.
Sheridan explained that UBER’s equity story focuses on its expanding end markets, rising profitability levels and greater evidence of cross-selling opportunities on the platform, which should help investors reconsider growth. , margins and the company’s free cash flow potential.
With 32 Buys and two Holds, Wall Street has a Strong Buy consensus rating on Uber Technologies stock. The average UBER stock price target of $91.86 implies a 27.5% upside potential from current levels. Shares are up 17% so far this year.
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Shares of e-commerce and cloud computing giant Amazon are up 37% so far this year. The company recently impressed investors with its upbeat third-quarter results. AMZN’s third-quarter sales grew 11% to $158.9 billion, driven by the strength of its retail, AWS (Amazon Web Services) cloud and advertising businesses.
Additionally, third-quarter earnings per share increased more than 50% to $1.43, driven by strong revenue growth and improved margins. Amazon’s aggressive streamlining and cost-cutting measures are driving higher margins.
Like other tech giants, Amazon is also making significant investments to seize opportunities in AI. The company has made $51.9 billion worth of capital investments so far in 2024 and expects to spend around $75 billion on capital expenditures throughout the year.
On Nov. 1, Citi analyst Ronald Josey raised his price target on Amazon shares to $252 from $245 and reaffirmed a Buy rating. Josey said that following the third quarter results, he is increasingly confident in the company’s ability to make growth investments while achieving significant margin expansion.
Commenting on AWS, he noted that the unit’s AI business is a multibillion-dollar revenue business that continues to grow at a triple-digit rate year over year. He expects generative AI revenue to drive AWS’s business as new instances and demand increase. For Citi, Amazon remains one of the main options in the Internet sector.
Overall, Amazon earns a Strong Buy consensus rating on TipRanks based on 44 Buys and a Hold recommendation. At $238.35, the average price target for AMZN stock implies a 14.5% upside potential.
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Wall Street is very optimistic about the growth prospects of Meta Platforms, Uber Technologies and Amazon. Analysts see UBER’s pullback as a good opportunity to buy shares and benefit from its long-term growth story. They see greater growth potential in Uber stock compared to the other two tech stocks.
