Varun Takkar
Stock & Options Trading, Technical Analysis, Trading Community
Meta's multi-year bull thesis remains intact despite short-term technical weakness, making a dip to $550-$560 a re-accumulation opportunity. The stock trades below its 8-, 50- and 200-day EMAs, pointing toward ascending trendline support at $550-$560. Its ad and messaging monetization, AI-driven targeting and aggressive AI capex position it as a long-term generative AI winner, and the trend from the $520 base remains valid. x.comÂ
Meta's new cloud business turns its massive capex into a revenue-generating asset, following Amazon's AWS playbook. Per a July 1 Bloomberg report, Meta Compute will sell AI compute and hosted models to enterprises, easing fears over 2026 capex guidance of up to $145 billion. At about 19-20x forward earnings versus a five-year median near 26x, the stock is cheap. A 159% volume surge on July 1 signals institutional buying, and the dip on a $1.4 trillion state lawsuit looks like a bear trap. x.comÂ
Meta's early AI monetization in its core business makes the long-term upside potentially far greater than the short-term pain from its planned $95B capital raise and possible dilution. Its fair value is $1,100, and the shares are worth holding for years despite short-term moves. If Meta monetizes the infrastructure, upside is massive; even if it does not, the assets still have value. x.comÂ
Meta's AI infrastructure financing raises the risk that a long wait for revenue and profit will keep its shares volatile. It disclosed plans to raise up to $95 billion. @amitisinvesting warns that further dilution could keep the stock stuck even if the buildout eventually pays off. Meta's selloff is still a massive buying opportunity. x.com x.com x.comÂ
Meta looks unattractive because its fines, capital raises and AI capex make the math ugly. The stock could trade back to the $500s, while hyperscalers probably have to make those raises with equity down 15-25%. Muse looks like a fad and average users may not need AI agents, matching LogicalThesis's view. x.com x.com x.comÂ
Meta could reach $750 by October 23, with its options map showing a $750 call wall across the next two weeks while the stock trades near $720. The near-term path adds a positioning basis to the earlier AI and valuation upside case; earnings follow on October 28. x.comÂ
Meta's earnings beat removes the immediate earnings risk from its bullish setup, with the 688 area holding on a closing basis. Q3 revenue was $64.6 billion, up 26%, and EPS of $3.83 beat estimates; Q4 revenue guidance is $73-76 billion. Wave 4 may have ended near 681; a close above the 9- and 21-day averages near 715 would confirm that count, with 755, 773 and 796 as targets. x.comÂ
Meta's planned stock offerings to finance AI growth merit a selloff in its shares. The Wall Street Journal reports up to $95 billion in financing and a potential at-the-market offering of up to $60 billion, possibly beginning in Q1 2027. Send Meta to zero. x.comÂ
Meta's ad engine is still growing, and its higher AI spending comes with a stronger revenue outlook. Revenue was $64.6B versus $63.4B expected, with $63.1B in ads; the Q4 guide midpoint of $74.5B beat $73.7B expected. Meta raised only the capex floor to $135B, leaving the $145B ceiling unchanged. The roughly $10B legal charge depressed reported EPS, not ads. Overweight, $1,004 target with 41% upside. x.com x.comÂ
Meta's core advertising business is significantly outgrowing its biggest competitors even before factoring in the newer businesses it is building. Q3 ad revenue rose 26% year over year, versus 10.6% at Alphabet and 10.9% at Amazon. Back at 19x forward earnings, Meta is the most undervalued Magnificent Seven stock. x.com x.comÂ
Meta's next-year earnings consensus of $34 a share makes a 30x forward multiple too optimistic unless it delivers a major surprise. The proliferation of $1,000 price targets also looks like a warning to get out. x.com x.comÂ
Meta's growth and earnings make its valuation appealing. It trades at 17x 2027 estimates with 17% EPS and 22% revenue growth. Its $140 billion EBITDA should make it worth more than Anthropic, which has none, though that comparison could be wrong. If distribution is king, Meta Muse could benefit from Meta's 3.64 billion daily active users, according to GuruFocus News. x.com x.com x.comÂ
