Meta (META), Google (GOOGL), Reddit (RDDT), Pinterest (PINS), and Snap (SNAP) all took a hit from Bank of America this week, as the firm slashed its price targets across the digital advertising space. The reason? A projected $21 billion pullback in 2025 ad spend. But before anyone screams “tech crash,” let’s look closer—because Wall Street might just be overreacting… again.
Yes, tariffs are in the headlines. Yes, Bank of America says brands may tighten their belts. But here’s what’s being overlooked: the digital ad economy is still booming. Tech giants like Meta and Google aren’t crumbling—they’re adjusting to a new phase of growth, one shaped by AI, automation, and a more performance-driven advertising landscape.
BofA Turns Bearish—But Still Says “Buy” ?
Here’s where it gets interesting. Even as BofA chopped its Meta price target by 16% (to $640 from $765), it reaffirmed its Buy rating. Same for Google and Pinterest. Translation? Wall Street still believes these platforms are long-term winners—it just doesn’t want to admit it too loudly during a tariff-fueled news cycle.
BofA’s analyst Justin Post warned of ad spend risks tied to “negative headlines” and Trump’s tariff shuffle, but let’s not forget—Meta and Google are cash-printing machines. They’re not losing business; they’re adjusting strategy. And let’s be real: if these companies were truly in trouble, would analysts still be telling clients to buy the dip?
The Tariff Plot Twist That Flipped the Market
In a dramatic twist worthy of a Netflix docuseries, Trump suddenly reversed part of his tariff plan on Wednesday—pausing new levies on most countries for 90 days (except China, which got hit with a 125% tariff hike). The market response? Explosive.
The S&P 500 ripped 9.5% higher. Social media stocks went vertical:
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Meta: +15%
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Google: +9%
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Reddit: +24.7%
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Snap: +22%
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Pinterest: +14%
So much for that “ad recession,” huh?
Meta even closed back above its 21-day moving average—signaling strength after weeks of choppy trading. This bounce wasn’t just technical; it was a reality check. Investors were reminded that while headlines can spook the market, fundamentals still matter—and Meta’s fundamentals are rock solid.
Wall Street’s Quiet Confidence
Let’s decode what BofA didn’t say out loud. Despite trimming 2025 revenue estimates—Meta (-4.4%), Google (-3.7%), Pinterest (-5.8%), Snap (-5.9%), and Reddit (-6%)—the firm still sees Meta and Google dominating, thanks to deeper ad auctions, robust direct-response channels, and favorable currency tailwinds.
In other words: Meta and Google are better positioned than ever. And if this is them in a “challenging” market, imagine what happens when the ad spigots open again.
The Real Story? Digital Advertising Isn’t Slowing—It’s Evolving
Sure, there may be a temporary dip in brand advertising. But performance marketing—the kind that actually drives clicks, sales, and revenue—is still king. And that’s where Meta, Google, and Amazon shine.
Meanwhile, Reddit and Snap are in a tougher spot, more exposed to fickle branding budgets. Reddit’s target was slashed 42%—ouch—but its stock still soared nearly 25% after the tariff reversal. That’s not weakness, that’s volatility. And in today’s market, volatility often creates opportunity.
The Bottom Line
This week’s drama was a masterclass in market psychology. Tariffs caused panic. Analysts recalibrated. Stocks fell… and then came roaring back. The smart money? It’s not running scared. It’s watching closely, waiting for moments like this to pounce.
So yes, BofA trimmed expectations. But they also handed savvy investors a gift: a cheaper entry point into the digital ad giants shaping the future of global commerce.
Don’t call it a downturn—call it a reset. And in resets, fortunes are made.
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