01:32 PM EDT, 08/01/2024 (MT Newswires) -- Meta Platforms ( META ) will continue to invest aggressively in generative artificial intelligence and in GPU-enabled platform improvements as return on such investments exceeds expectations, Morgan Stanley said Thursday.

The Facebook and Instagram parent has the "most tangible" return on invested capital among companies that Morgan Stanley covers, the investment firm said after Meta's upbeat Q2 earnings.

"META remains the best case study of how GPU-enabled analyses of leading first party data sets can drive material improvements. In this case it comes thru as better engagement and revenue growth and a growing list of next gen call options," the firm said.

The firm raised its capex estimates for Meta in 2025 and 2026 to $47 billion and $53.1 billion, respectively, from $44.6 billion and $47.5 billion. For 2024, its capex estimate now is $40.0, down from $40.1 billion previously.

Morgan Stanley raised price target for Meta to $575 from $550 and reiterated its overweight rating. Meta shares were up nearly 5% in recent trading.

Price: 497.09, Change: +22.26, Percent Change: +4.69