Is META a good stock to buy? We came across a bullish thesis on Meta Platforms, Inc. on Fundamentally Sound’s Substack. In this article, we will summarize the bulls’ thesis on META. Meta Platforms, Inc.’s share was trading at $584.59 as of June 9th. META’s trailing and forward P/E were 21.29 and 18.62 respectively according to Yahoo Finance.
Copyright: antonioguillem / 123RF Stock Photo
Meta Platforms, Inc. engages in the development of products that enable people to connect and share with friends and family through mobile devices, personal computers, virtual reality (VR) headsets, and AI glasses in the United States and internationally. META is being presented as one of the most compelling large-cap opportunities in the market despite widespread concerns surrounding elevated AI infrastructure spending and broader macro uncertainty.
Read More: 15 AI Stocks That Are Quietly Making Investors Rich
Read More: Undervalued AI Stock Poised For Massive Gains: 10000% Upside Potential
While many investors remain skeptical of META’s aggressive capital expenditures and continue demanding clearer proof of return on investment, the company’s recent operating performance suggests that AI investments are already materially improving the core business.
META reported exceptionally strong Q1 2026 results, including 33% year-over-year revenue growth to $56.3 billion, 41% operating margins, and operating cash flow growth of 34%, while maintaining over 3.56 billion daily active users across its family of applications. Although the stock sold off following earnings due to concerns about a slight quarter-over-quarter decline in daily active users and continued elevated capex guidance, the thesis argues that the market is overlooking the effectiveness of META’s AI-powered advertising ecosystem.
AI-driven recommendation systems, ad sequencing tools, GEM models, and adaptive ranking engines are improving engagement, increasing ad relevance, and driving both higher ad pricing and impression growth simultaneously, resulting in accelerating advertising revenue and improving return on ad spend for advertisers. The company’s investments in GPUs and infrastructure are also supporting broader monetization opportunities across WhatsApp, Meta AI, and smart glasses, all of which provide additional long-term growth vectors beyond the core advertising business.
Despite concerns about debt levels and free cash flow compression during this capex cycle, META still maintains a strong balance sheet and substantial earnings power. Using various valuation methodologies, including EV/EBIT, EV/EBITDA, and owner earnings models, the thesis concludes that META remains significantly undervalued relative to its long-term growth potential and cash-generating capabilities.
Previously, we covered a bullish thesis on Meta Platforms, Inc. by LongYield in May 2025, which highlighted Meta’s AI-driven advertising growth, strong Family of Apps profitability, and expanding monetization opportunities across WhatsApp, AI assistants, and wearables. META’s stock price has appreciated by approximately 2.16% since our coverage. Fundamentally Sound shares a similar view but emphasizes on Meta’s accelerating AI infrastructure returns and long-term valuation upside.
Meta Platforms, Inc. is on our list of the 40 Most Popular Stocks Among Hedge Funds. As per our database, 262 hedge fund portfolios held META at the end of the first quarter which was 256 in the previous quarter. 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 this cheapest AI stock.
Disclosure: None.
