Meta Is Creating a New Class of Stock. What Shareholders Need to Know

Meta Platforms (NASDAQ:META | META Price Prediction) is restructuring its capital structure. Along with third-quarter results, Meta announced a new non-voting Class C common stock, effective January 2027. Shares trade at $662.49, down 5.02% today.

The 24/7 Wall St. price target for Meta sits at $822.91 over the next 12 months, implying 24.2% upside. The stock earns a buy rating with high confidence from the model.

CFO Susan Li said the shares are meant to be “usable for capital raising, employee compensation, acquisitions, other general corporate purposes while preserving the voting power of existing Class A and B shareholders.”

She added that Meta has “no specific financing plans to announce at this time.” Coverage described the move as a way to keep Zuckerberg in control and in California. For outside holders, the practical question is future dilution, since Meta now has a currency to fund AI spending without reducing founder control.

A $9.9 Billion Charge and Negative Free Cash Flow Hit Shares

Meta is down 10.18% over the past week and 10.62% over the past month, leaving it up just 0.61% year to date. Shares sit 15% below the 52-week high of $779.82 and 27.6% above the low of $519.37.

Q3 revenue rose 26.07% to $64.60 billion, beating the $63.39 billion consensus. GAAP EPS of $3.83 missed expectations of $5.70 because of a $9.89 billion teen mental health settlement charge. Excluding it, EPS would have been $7.40. Capex of $34.91 billion pushed free cash flow to -$2.12 billion, and the negative free cash flow drove today’s selloff.

Why Bulls See $857 and Beyond

Advertising remains a cash machine. Ad pricing rose 14% and impressions climbed 10% across 3.64 billion daily active people. Q4 revenue guidance of $73 billion to $76 billion signals acceleration.

Zuckerberg expects to improve Muse’s compute efficiency “by more than 10x in the next year,” and new AI businesses could start adding revenue in 2027. The bull case hits $857.79, or 29.5% upside.

Dilution and Cash Burn Are the Risks Worth Watching

Operating margin fell to 20% from 40%, and total youth litigation exposure stands at $18.59 billion with more trials ahead. Debt has hits $83.7 billion. Class C issuance could reducing holders who have no vote.

Still, the margin drop mostly reflects a one-time charge, and cash and marketable securities of $82.4 billion give Meta room to operate. The bear case of $716.27 still sits above today’s price.

How Meta Compares to Alphabet and Snap

As the closest AI and advertising competition, Alphabet (NASDAQ:GOOGL) already uses non-voting Class C shares. It set up an at-the-market program for up to $40 billion in Class A and Class C stock, which is a template for how Meta could use its new class. Alphabet’s lower P/E is inflated by a $99.03 billion equity gain, while its higher P/FCF multiple makes Meta’s look reasonable.

Snap (NYSE:SNAP) gives public investors only non-voting Class A shares and faces the same youth-safety litigation. It remains unprofitable, so Meta’s earnings power justifies a premium.

Meta has the fastest growth of the three and sits in the middle on cash-flow valuation, so our target looks reasonable relative to peers.

Meta Price Prediction 2026-2030

The 24/7 Wall St. price target of $822.91 carries a buy rating at 90% confidence. What tips the scale is 26.07% revenue growth behind a one-time legal charge.

The rating gets stronger if Q4 lands within guidance and Muse costs fall. It weakens if Meta issues large blocks of Class C stock before its AI revenue grows.

The projections rest on Meta continuing to carry out its current strategy. Largest Class C dilution or more litigation losses could pull results lower, and faster AI monetization could push them higher.

Much of that monetization depends on the picks-and-shovels suppliers driving the data-center expansion, which we profiled in a free report on seven AI infrastructure stocks that aren’t chipmakers.

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