META, an Undervalued AI stock. Really !
“AI” labelled stock, BOOM !
When $SpaceX(SPCX)$ rocketed into the public markets on 12 Jun 2026, it hit a peak valuation of $2.2 trillion on the back of massive artificial intelligence (AI) expectations.
This highlights how eager Wall Street is to fund the future of AI.
While speculative hype often drives newly public entities to astronomical valuations, the most lucrative AI opportunities actually belong to established tech giants with the infrastructure to generate real financial gains.
Investors searching for structural value do not need to look to the cosmos, really !
The Hidden AI Winner.
A far more compelling opportunity exists in $Meta Platforms, Inc.(META)$, a company currently trading at an $800 billion discount to SpaceX but poised to dominate the AI landscape over the next 12 months.
While initial market euphoria often centers on pure-play AI narratives, META is poised to actually produce significant financial gains from continued advancements in AI technology.
The market appears to be undervaluing that opportunity (currently), making the stock a great buy for long-term investors.
The Capex & Growth Concerns.
Despite META’s strong revenue growth, investors' concerns about its massive, planned outlays on AI infrastructure have held the stock back.
The company expects capital expenditure (capex) to $145 billion in 2026, up from about $72 billion last year.
At the same time, management is guiding for operating income to continue to climb despite the higher spending.
The stock currently trades for about 17x forward earnings expectations, looking incredibly undervalued relative to the business's continued growth and opportunities ahead.
It will likely not be long before the market changes its view on META and sends its value significantly higher.
Do you think so, too ?
The Strategy.
To fully realize the financial upside of these massive infrastructure outlays, META is aggressively:
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Unlocking dormant monetization levers within existing software ecosystem.
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Simultaneously, pursuing its AI-agenda, like the rest of Mag 7.
The WhatsApp Evolution.
The most prominent manifestation of the “unlock” strategy is a sweeping structural overhaul at WhatsApp, designed to finally transform the world’s largest messaging platform into a high-margin revenue engine.
In June 2026, META executed a major leadership transition, appointing Kunal Shah, the celebrated founder of Indian financial technology unicorn CRED as the new global head of WhatsApp. (see below)
To solidify this alignment, META committed a massive $900 million investment into CRED, securing a roughly 20% minority stake at a $4.5 billion valuation.
Outgoing WhatsApp chief Will Cathcart, who spent 7 years expanding the platform's footprint to over 3 billion monthly users, will transition into a new role to build consumer products driven by AI.
This multi-faceted deal serves as a clear blueprint for how META intends to extract compounding structural value from its user base:
(1) Fintech & Commercial Convergence:
Placing a highly regarded fintech builder at the helm, META is pivoting WhatsApp away from being a mere communication utility and toward becoming an all-in-one transactional super-app.
Shah's experience scaling digital payment systems and credit infrastructure will be crucial in expanding WhatsApp’s (i) digital commerce, (ii) local payments, and (iii) peer-to-peer financial services.
(2) Core Demographics Focus:
The move doubles down on India, which represents WhatsApp’s largest market with over 500 million users.
It positions META directly at the center of the India’s exploding digital economy, creating a launchpad for scalable business messaging and subscription architectures that can subsequently be exported globally.
(3) The Conversational AI Flywheel:
The leadership restructuring directly intersects with META's overarching AI narrative.
While Cathcart focuses on pioneering consumer-facing AI applications, Shah's mandate includes deploying sophisticated, AI-powered business agents across WhatsApp's corporate messaging network.
Integrating fintech operational expertise with its advanced language models, META is establishing a frictionless commercial ecosystem where enterprise clients can:
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Automate customer service.
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Complete transactions.
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Manage logistics (entirely) within a chat thread.
This strategy demonstrates that instead of burning capital solely on unproven concepts, META is systematically applying its deep engineering capabilities to platforms with immediate monetization potential.
Thus, reinforcing the thesis that the market continues to fundamentally misprice META's structural growth path. Agree ?
The AI Outcome.
While strategic overhauls at the application layer (eg. WhatsApp leadership transition) are critical for direct monetization, META’s underlying technical thesis hinges entirely on owning the foundational intelligence that powers these platforms.
To ensure it possesses the raw algorithmic capabilities necessary to compete with pure-play AI labs, META executed a parallel structural transformation at the foundational layer.
Effort is anchored by appointment of 29-year-old Scale AI co-founder Alexandr Wang as Chief AI Officer to helm Metas Superintelligence Labs (MSL).
Division of labour between technical architecture & commercial deployment underpins this aggressive corporate pivot:
Building the Machine vs. Selling the Product:
Wang has been tasked with the operational engineering required to build frontier models, such as the recently debuted Muse Spark.
While, Zuckerberg has assumed the role of chief salesman.
The objective is to translate multi-billion-dollar compute clusters and infrastructure outlays into tangible consumer and enterprise habits, abstracting complex data engineering into seamless features across Instagram, Facebook, & WhatsApp.
The Wonder Kid delivers.
Under Wang's technical direction, META has systematically pivoted away from its historical open-source strategy to maintain strict, proprietary control over its next-generation models.
The “closed” ecosystem is essential for Zuckerberg's ultimate commercial goal: equipping every user and small business within META’s 3-billion-plus network with a highly tailored, personal AI agent that:
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Handles everyday transactions.
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Customer support, and digital commerce.
For investors, the dual-track strategy demonstrates how massive capex are being converted into defensible, high-margin ecosystem value, further highlighting why the market’s current valuation of the company remains fundamentally conservative.
My viewpoints : (mine only)
I think the tagline from Hollywood movie Jerry McGuire best sums up what I feel about META at the moment - “Show me the money”.
Mark Zuckerberg needs to show proof of both adoption & commercialization.
That is, the new Muse Sparks AI-model can attract paying users for its AI tools, besides just using the technology to enhance and bolster its core advertising business.
Six months into 2026, I am still unimpressed by META and its performance.
META is down -21% over the past 12 months.
It is Mag 7 group’s worst performer. (see above)
That’s even after Meta reported +33% revenue growth in Q1 2026 earnings results, the fastest rate of expansion for any period since 2021.
Many failures to launch.
Will Muse Spark turn out to be one of Zuckerberg’s many “fail to launch” products ?
(1) Metaverse.
The biggest failure being Metaverse that has reportedly burnt through $83.6 billion over a 5 year period beginning in 2020.
(2) Meta Quest.
The other biggie was its AR/VR headset - Meta Quest.
It is a success having cornered 60% of market share but failed miserably for profitability due to heavy subsidy to make them “affordable” to consumers.
Supposedly, it is still in production but Zuckerberg has “moved on”, shifted his focus and perhaps leave it to die a natural death ?
(3) Smaller Misadventures.
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Libra / Diem. META’s blockchain/currency project was shut down after regulatory pressure and lack of traction. It did not become a meaningful revenue business.
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Lasso. META’s short-form video app meant to compete with TikTok was killed off after failing to gain traction.
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Facebook Phone / HTC First. META’s attempt at a Facebook-centric phone flopped quickly in the market.
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Portal & smartwatch efforts. These hardware pushes failed to become major consumer businesses and were effectively dead ends.
All these smaller “misadventures” have collectively reported costs $10+ billion conservatively.
META, a “Buy” - Really?
I think most investors would have forgotten all these gone-wrong projects.
Despite that, META managed to stay afloat, thanks to its deep pocket.
The critical question (now) is whether it can afford further mistakes in an AI race where its peers already boast more compelling use cases and a track record of successful rollouts.
Is META a “Buy”, suggested by Motley Fool ?
For that I defer to its technical indicators of (a) Simple moving averages (SMA), (b) MACD and (c) RSI, to confirm some basic facts and hopefully clues. (see below)
As of 23 June 2026 end day
(1) Simple Moving Averages (SMAs).
On 23 Jun 2026, META ended the day at $562.20 per share when market closed for the day.
This means, META is trading below its short-, medium-, and long-term trend lines, that is a bearish technical setup.
With stock price sitting below its SMAs, the SMAs act as overhead resistance for META. For now, any bounce may get sold until stock price reclaims the averages, especially the 50-day and 200-day lines.
With META’s “death cross” still active (since 9 Dec 2025), it will be a while before the 50-day SMA crosses the 200-day SMA from below.
(2) MACD.
Both MACD line (-13.24) and Signal line (-10.95) are significantly below the Zero line, it implies META is bearish in the immediate term.
With the MACD line also below the Signal line, that adds a 2nd layer of weakness because short-term momentum is still lagging the already-soft trend.
With Divergence at -2.29, it means selling pressure has not eased yet. The stock’s momentum still favours the downside unless the MACD line starts rising back toward the signal line.
(3) RSI.
META’s 14-day RSI came in at 38.97, below the neutral 50 level.
This means META is still in bearish momentum and losses have been outweighing gains recently, but the stock has not reached oversold zone that often attracts bargain hunters.
Summary.
META is not just “below trend”; its momentum engine is still running in reverse.
The stock would need a meaningful price recovery to halt the downwards trend. Util that happens, Its technical indicator leans bearish rather than supportive.
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To witness Inflation slowly but significantly re-entering has become indeed a worrying sign.
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With the White House exceptionally quiet and Truth Social too about the deal - things aren't looking up.
Micron shares were last up 18.4 per cent at $1,236, giving it a market capitalization of $1.398 trillion, compared with Meta's $1.392 trillion.
As its news just out, will META continue to consolidate on a Friday by traders for fear that there might be more news out over the weekend ? What do you think...
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