Ford Motor (NYSE:F)
The surprise: Wall Street expected Ford’s Q2 2026 earnings to fall about 5% year over year. Ford instead posted an increase. The stock jumped more than 6% after the report.
The quarter’s story was Ford making more money on fewer sales. Wholesale volumes dropped 12% year over year, but revenue fell just 4%, because Ford sold a richer mix of high-margin trucks, off-roaders, and hybrids. Adjusted EBIT rose 17% year over year.
Ford raised full-year 2026 adjusted EBIT guidance, the second raise this year.
Bull case: The real reason to own Ford is Ford Pro, its commercial fleet business, and it’s the strongest asset any legacy automaker has. Pro sells to construction firms, delivery companies, and contractors — customers who keep buying through inflation and fuel spikes because a plumber can’t stop showing up to jobs. Those buyers are far steadier than the average consumer, who is pulling back right now. And Pro isn’t just vans. It’s an entire infrastructure of service centers, parts, and fleet software that builds a real moat. Fleet managers won’t switch to unproven rivals without a big reason, so undercutting Pro means rebuilding that whole ecosystem. Even in a weak quarter dragged down by a plant fire, Pro posted a 9.7% EBIT margin, roughly double Ford Blue’s 4.4%.
The second leg is the shift to higher-margin, recurring revenue. Ford Pro paid subscriptions hit 1.6 million in Q2 2026, up 50% year over year, and BlueCruise assisted-driving now makes up half of retail services revenue. Software margins beat metal by a wide gap, and if Ford hits its target of 8% margins on services by 2029, that flywheel starts to move the whole company.
On valuation, Ford trades around 8-9x forward earnings, roughly a 45% discount to the consumer discretionary sector and near its own five-year average. For an iconic company at an inflection year with margins expanding and guidance rising twice, bulls argue that discount is too steep. A 4% dividend yield is just a cherry on the top.
Photo by AlphaTradeZone
Meta Platforms (NASDAQ:META)
The surprise: Wall Street expected Meta to post Q2 earnings growth. The company instead reported a decline. The stock dropped nearly 10% after the report. Bulls say now is the time to buy.
Bull Case: Wall Street gets spooked by Zuckerberg’s huge AI spending. But bulls say that spending is showing results already.
Meta is turning its ad business into an AI monetization platform, and the payoff is already in the numbers. Revenue grew 28% year over year in the recently reported quarter, with ad impressions up 14% and price per ad up 12%. Advantage+, Meta’s AI ad product, is compounding: advertisers who use several of its tools get targeting, placement, budget, and creative optimization working together, and that’s why it’s already at a $75 billion annual run rate with 9 million small businesses on board. The Generative Recommender now scores ads against user preferences instead of one at a time, and that shift drove an 8.3% lift in Facebook ad clicks and a 15.7% jump in conversions. AI isn’t a future promise here — it’s already feeding the part of the company paying the bills.
The bigger long-term prize is the compute. Zuckerberg said Meta is getting offers for its compute capacity at a significant premium to what it paid, so the infrastructure has resale value even before Meta decides how to use it. The company can improve its core apps, train frontier models, sell APIs and business agents, or monetize excess capacity to third parties. No rival has Meta’s 3.6 billion daily active users to build personal AI on top of, and new lines like WhatsApp paid messaging are already scaling fast.
Meta now trades under 18x forward earnings, down near its October 2023 lows and far below where it sat before the report. That’s a discount to AI peers like Microsoft and Alphabet that can already monetize AI directly. For a business still growing revenue at 28%, bulls argue the market has already priced in the CapEx fear, leaving room to accumulate before the story plays out.
Bear case: Meta FCF is falling and the company is now in a spending spiral to survive in the AI race. Wall Street sees capital spending crossing $200 billion by 2028. The problem is Meta spends like a hyperscaler but has no cloud business to monetize the compute. The ad engine that funds all of it is showing some deceleration, with daily active users up just 3% year over year.
While we acknowledge the risk and potential of META as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than META and that has 10,000% upside potential, check out our report about the cheapest AI stock.
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