Meta: The Market Is Asleep At The Wheel

Meta Platforms is initiated with a strong buy and $882 PT, citing undervaluation and robust core ad business growth. META's Family of Apps segment drives over 97% of revenue, with ARPU and ROAS rising despite margin compression from AI infrastructure spending. Capex intensity is high, but I expect margin declines to moderate and EPS growth to accelerate in 2025, supporting a catch-up trade. Risks include persistent Reality Labs losses, capex overruns, regulatory threats, and macroeconomic sensitivity, but current Street estimates provide downside cushion.

Meta (META) stock at the time of writing is down about 5% YTD. This decline for such a well-owned stock over the years is, in large part, owed to the significant rotation away from Mag 7 and enterprise software names