Shares of tech large Meta Platforms are set to leap over 10% within the subsequent 12 months, in line with Brian Nowak, an fairness analyst at Morgan Stanley. The U.S. funding financial institution has a value goal of $375 on the inventory — giving it potential upside of round 11.5% from its closing value of $336.31 on Nov. 14. Meta is among the many so-called “Magnificent Seven” shares that a number of buyers have been favorably this yr. The opposite shares on the checklist are Alphabet , Amazon , Apple , Microsoft , Nvidia and Tesla . Whereas Meta has been on buyers’ radars, the inventory was beneath strain final month throughout a current tech sell-off. Issues on Meta had additionally emerged after Chief Monetary Officer Susan Li’s feedback on the promoting market within the fourth quarter. The corporate — which operates social media platforms Fb, Instagram, Threads and WhatsApp – supplied a wider income steerage vary than regular, given the uncertainty of how the escalating battle within the Center East will have an effect on advert spending, with Li explaining that on the corporate’s earnings name. Shares in Meta are up near 180% year-to-date. META YTD mountain Yr-to-date share value of Meta Going ahead, Nowak stays chubby on the tech large. “What we really liked about Meta is we think the market is still under appreciating the durability of their revenue growth in 2024 and 2025,” he instructed CNBC’s ” Street Signs Asia ” on Wednesday. “Engagement is growing, driven by Reels and Reel monetization. And as Meta is monetizing Reels at a higher rate, quarter over quarter is driving much faster than appreciated ad revenue growth, we think into 2024 and 2025,” he defined. Reels are full-screen vertical movies on the Instagram platform that Meta owns. Nowak additionally believes the tech large’s energy comes from the self-discipline on its working expenditure. “We think the free cash flow that comes through is just not appreciated and the stock is pretty inexpensive relative to free cash flow growth or earnings growth,” he defined. In a Nov. 2 be aware to buyers, Morgan Stanley wrote that it expects Meta’s “reels + click to message + core” segments to translate to a $22 to $23 progress in earnings per share in 2025. This comes as Reels continues to be monetizing at an estimated charge of round 30% — which is the speed of “core” income that comes from segments similar to Tales and Feed (two completely different options of the Instagram platform). It can additionally lead to incremental Reels advert income of $11.4 billion in 2024 and $12.9 billion in 2025, the analysts led by Nowak detailed. “We expect growth to be driven by ad load, further improvements in matching/attribution and performance-driven pricing in the auction market,” they mentioned including that these ranges of Reel monetization could show conservative by 2025 given the ramp to this point and optimistic advertiser traits. In the meantime, they anticipate Meta’s click on to message advert phase to register 20% and 16% year-on-year progress in 2024 and 2025 —to hit $2.4 billion and $2.3 billion, respectively. This follows new advertiser adoption, new advert codecs, and AI-based innovation, the analysts mentioned. — CNBC’s Isabella Lok contributed to this report.