• Meta stock is a buy as the company is rolling out a subscription model, Bank of America said.

• Analysts wrote in a Tuesday note that the subscription service is "a potential high margin business."

• "We are intrigued by this offering, which follows Twitter Blue and likely reflects demand for more services by Facebook's creators," the note said.

Bank of America suggests taking advantage of Facebook-parent Meta's move to offer a subscription model, similar to Elon Musk's move with Twitter Blue.

In a Tuesday note, analysts at BofA gave Meta stock a buy rating and a price target of $220, representing 26% upside from current levels.

Over the weekend, CEO Mark Zuckerberg announced a new paid subscription service called Meta Verified that will give verified badges to paying users.

BofA said the subscription service is "a potential high margin business," and suggested that Meta could see as much as 12 million paid subscribers by early 2024, once the company rolls out the product globally.

"We are intrigued by this offering, which follows Twitter Blue and likely reflects demand for more services by Facebook's creators," the note said.

As chief executive of Twitter, Musk first launched Twitter Blue in November 2022 in a bid to generate revenue for the social media platform. And on Monday, he said it's "inevitable" Meta would go Twitter's way and charge for verified statuses

For its part, Twitter's transition yielded roughly 300,000 subscribers as of the middle of January, BofA estimated.

Given the wider global reach of a combined services for both Facebook and Instagram, BofA said Meta's test run in New Zealand and Australia could lay the groundwork for a boost the company's stock and add a 3% increase to earnings-per-share.

"Given a broader audience reach and bigger revenue opportunity for creators, we believe Meta could outperform the subscriber ramp (as a percent of users) of peer subscription offerings (the service will likely be refined and improved over time)," the note said.

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