Meta Platforms, Inc. (META): A Bull Case Theory 

We came across a bullish thesis on Meta Platforms, Inc. on Investment Ideas by Antonio’s Substack by Antonio Linares. In this article, we will summarize the bulls’ thesis on META. Meta Platforms, Inc.’s share was trading at $668.73 as of January 28th. META’s trailing and forward P/E were 28.47 and 22.47, respectively according to Yahoo Finance.

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 and mixed reality headsets, augmented reality, and wearables worldwide. META’s roughly 80% stock decline in 2022 was widely attributed to fears that Mark Zuckerberg was recklessly betting the company on the Metaverse, but this interpretation missed the core reality that most of Meta’s capital expenditure was actually being deployed to build compute infrastructure for AI-driven recommendations.

This investment wave began well before the market grasped the scale of the large language model revolution. As a result, Meta’s free cash flow per share has broadly tracked rising CapEx, reflecting a clear translation of infrastructure spending into greater intelligence, increased user engagement, and improved monetisation.

Similar to how Amazon has seen materially higher purchase intent through AI-driven tools, Meta is experiencing tangible gains across its platforms as incremental intelligence is deployed. Time spent on Facebook and Threads rose 5% and 10% quarter-over-quarter, respectively. Both apps are up double digits year-over-year, Instagram video time increased 30% year-over-year, and Lattice drove a 3% quarter-over-quarter improvement in ad conversions, reinforcing the link between AI investment and financial performance.

Despite these outcomes, Meta shares sold off 17% recently after the company raised FY2025 CapEx guidance to $70–72 billion, a move that again unsettled investors. However, Q3 2025 results show that higher CapEx continues to expand Meta’s earning power, with AI capabilities doubling roughly every six months and delivering accelerating value to users and advertisers. Zuckerberg emphasized that Meta consistently underestimates profitable demand for compute, leaving its core apps effectively compute-constrained.

Further strengthening the thesis, Meta is improving returns on CapEx by consolidating hundreds of smaller ad models into fewer, more powerful architectures, magnifying economies of scale and challenging traditional assumptions about diminishing returns. In this context, temporary volatility appears less like a warning sign and more like an opportunity, as Meta’s AI-driven value creation continues to outpace conventional market expectations under the stewardship of a proven founder-operator.

Previously, we covered a bullish thesis on Meta Platforms, Inc. (META) by LongYield in May 2025, which highlighted strong Q1 execution, AI-driven ad monetisation, margin expansion, and valuation upside. META’s stock price has appreciated by approximately 16.86% since our coverage due to improving earnings momentum. Antonio Linares shares a similar thesis but emphasizes CapEx misinterpretation and accelerating AI compute-driven returns.

Meta Platforms, Inc. is on our list of the 30 Most Popular Stocks Among Hedge Funds. As per our database, 273 hedge fund portfolios held META at the end of the third quarter which was 260 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.

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Disclosure: None.