Meta: Cheap, But Is It Worth The Drama?

Right. So, the “Magnificent Seven.” It sounds like a superhero team, doesn’t it? Except instead of saving the world, they mostly just save my portfolio…sometimes. Nvidia, Apple, Alphabet, Microsoft, Amazon, Meta, and Tesla. The usual suspects. Honestly, being in that group is practically a guarantee of attention, which is good, because most of these stocks rarely have a sale. It’s like trying to find a reasonably priced avocado.

Anyway, I’ve been looking at the numbers, and Meta seems…cheap. Relatively, of course. Everything is relative when you’re staring into the abyss of the stock market.

Units of Cryptocurrency Lost: 12. Hours Spent Watching Charts: 9. Number of Panicked Texts to Friends: 24. (It’s been a week).

I’ve been trying to work out how to value these things. Price-to-earnings is the obvious one, but with these growth stocks, it feels a bit…backward-looking. Like judging a cake by how much flour was used, not how it tastes. So, forward P/E seems more sensible. It’s about potential, isn’t it? What

could

be, not what

was

And Meta…well, it’s the cheapest of the bunch. The chart says 21.1 forward earnings. The S&P 500 is at 21.9. Which means, theoretically, it’s undervalued. I know, I know. It sounds too good to be true. It probably is.

But here’s the thing. Meta is spending

a lot

of money. Like, seriously, a frightening amount. They’re throwing billions at AI. It’s a bit like that ex-boyfriend who kept promising to write the Great American Novel, except instead of a novel, it’s…algorithms?

In Q4 they made $59.9 billion in revenue. Impressive, right? Except $58.1 billion of that came from advertising. It’s still an advertising company, let’s be honest. A very, very large advertising company. The Reality Labs division lost $6 billion. Six. Billion. It’s like burning money to stay warm.

They’re planning to spend between $115 billion and $135 billion on capital expenditures, mostly on AI. It’s…ambitious. The market is worried, naturally. Remember the metaverse? Billions spent, very little to show for it. It feels like they’re hoping AI will be different.

Will become disciplined long-term investor: Status: Failing.

The problem is, until we see some actual profit from this AI spending, the stock isn’t going to climb back to its former glory. It’s going to trade at a discount.

So, is it worth buying? If you believe in AI, and you believe in Meta’s approach, maybe. It could be a monumental buying opportunity. But you need to be patient. Very patient. And you need a strong stomach. And possibly a therapist.

I’m still on the fence, to be honest. It’s a gamble. A very large, very public gamble. And I’m not entirely sure I’m feeling lucky.

2026-02-22 07:32

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