BofA reiterated a Buy rating and $300 price target on Meta Platforms Inc (NASDAQ:META) in a note Monday, telling investors that increasing AI could lead to multiple expansions.

Analysts explained that Meta introduced a new generative AI tool for advertisers (AI Sandbox) and new features for its Advantage and suite of products.

“In recent years, Meta has aggressively invested in GPUs to build its AI capabilities, and we think greater visibility on new AI products is positive for the stock,” said the analysts.

They noted that the social media giant’s growing suite of AI services for advertisers and developers could “help build competitive moats and multi-year platform retention, addressing concerns around terminal value uncertainty.”

“Also, new AI tools could help with revenues, our recent channel checks have highlighted that company’s Advantage+ products are helping advertisers reduce back-end costs related to ad creation and format optimization (estimated 5-10% of overall spend), which could be put back towards advertising, aiding Meta’s growth,” the analysts added.