META 2025 Forecast: Does a Trump-Musk Combo Spell Trouble for Meta Stock?

While the broader markets have rallied since Donald Trump’s election, the price action in some tech names has been quite muted. Apple (AAPL), for instance, has sagged - and quite understandably so, given the former president’s tariff threats and tough stance on China, which happens to be the second-biggest market for the iPhone maker.

Meta Platforms (META) stock has also looked shaky since Trump’s election. In this article, we’ll see what a Trump presidency with Tesla (TSLA) CEO Elon Musk as one of his key lieutenants means for Meta stock.

Trump’s Relationship with Meta Has Been Nuanced

Trump hasn’t had the best of relations with Big Tech companies, especially those in the social media space, as conservatives have long argued these platforms are biased against them. Facebook, incidentally, banned Trump for two years after the Capitol Hill insurrection in 2021. A lot has happened since then, and Facebook has long since restored Trump’s account. Trump now has his own social media company, Truth Social, while X (formerly Twitter) is now owned by Musk.

As ironic as it may sound, Trump—who signed an executive order in 2020 that could have banned TikTok—is now against the ban. To be sure, while the Biden administration passed a bill that proposed banning TikTok if ByteDance did not divest its stake, a ban on the popular short video app always looked like a near impossibility.

While a U.S. ban on TikTok would have been positive for Meta and Snap (SNAP), as they compete with the ByteDance-owned company for digital ad dollars, the possibility of a ban now looks even more remote as Trump takes office.

However, earlier this year, Trump termed Facebook “an enemy of the people” and said that it was as bad as TikTok. But in a podcast last month, Trump said that he likes Meta CEO Mark Zuckerberg “much better now.” The president-elect added, “I actually believe he’s staying out of the election, which is nice.” Zuckerberg was one of many tech CEOs who congratulated Trump on his victory.

That said, a possible crackdown on Chinese imports under a Trump presidency is a risk for Meta, as Chinese advertisers trying to reach Western audiences helped drive the growth for the company in recent quarters.

Zuckerberg and Musk Share an Acrimonious Relationship

Zuckerberg has shared an acrimonious relationship with Musk for years now. Trump has tapped Musk along with Vivek Ramaswamy to head the Department of Government Efficiency or “DOGE.” Having their CEO's bete noire as one of the President's top advisors is not exactly a soothing proposition for Meta investors. 

Notably, the Americans for Responsible Innovation (ARI) has petitioned Trump to have Musk as his special advisor on artificial intelligence (AI). I believe Musk will have the president’s ear on AI regulations in his second administration – whether officially or unofficially. Musk has gone to bat for AI regulations, and warned of the technology becoming rogue if not regulated.

Meta is among the most prominent AI plays, and is an early beneficiary of the AI pivot. During the Q3 earnings call last month, Zuckerberg said, “More than 1 million advertisers used our gen AI tools to create more than 15 million ads in the last month.” The Meta CEO added that AI feeds have led to more time spent on Facebook and Instagram.

Meta Stock 2025 Forecast

Stifel analyst Mark Kelley believes that not much will change for Meta under the next Trump administration and said, "As such, we don't view a Trump presidency as a negative (for social media), per se." 

He added, "We view his term as unlikely to help the other short-form video properties (Snap, Meta Reels, YouTube Shorts) from attracting more ad budget in the absence of TikTok. Meta and Snap are being weighed down a bit today, so there were clearly some folks who view the election results as a negative, but we're more in the 'neutral' camp."

Sell-side analysts continue to remain bullish on Meta, and it has a consensus rating of “Strong Buy” from the 51 analysts covering the stock. Its mean target price of $650.74 is just over 12% higher than yesterday’s closing prices, while the Street-high target price of $811 is almost 40% higher.

Should You Buy or Sell Meta Stock Now?

A section of the market is apprehensive about Meta after Trump’s election, which is not surprising. I have been circumspect about Meta for some time now, primarily due to the company’s rich valuations that don’t leave much on the table, at least for the short term. 

Meta’s YoY revenue growth is expected to slow down to 14.6% in 2025, as compared to an expected growth of 20.7% this year. Importantly, analysts expect the company’s earnings per share (EPS) to rise by only 11.3% YoY next year. The “efficiency” theme has run its course for Meta, and costs are expected to rise next year amid higher AI capex and an increase in headcount.

Meta faces another headwind as a judge has ruled that the Federal Trade Commission’s (FTC’s) antitrust case against the company can move to trial. The case adds regulatory uncertainty for Meta and could be an overhang on the shares – just as Alphabet (GOOG) has been in the Wall Street penalty box due to the antitrust case.

FTC has been pretty harsh on Big Tech companies under Chair Lina Khan, who is widely expected to be replaced under the incoming Trump administration. We still don’t have clarity on who might be Khan's potential successor at the agency, but regulatory scrutiny and enforcement is broadly expected to be less aggressive for big tech companies under Trump's purview.

Overall, I believe that while Trump’s presidency is perhaps not all that negative for Meta (if not overtly positive), the expected slowdown in its sales, rich valuations, and the antitrust case might still keep a lid on the stock in the short to medium term.