Is Meta Platforms an Underrated Artificial Intelligence Stock?

Core Viewpoint - Meta Platforms is focusing on artificial intelligence (AI) as a new growth opportunity, planning to launch a stand-alone AI app to enhance visibility and potentially create a new revenue stream [1][2][3] Group 1: AI Strategy and Launch - Meta is set to introduce Meta AI, a stand-alone application, later this year, expanding its portfolio which already includes popular apps like WhatsApp, Facebook, Messenger, and Instagram [2] - The launch of Meta AI aims to improve the visibility of its chatbot and could mirror subscription models seen in other AI platforms like ChatGPT [3] Group 2: Competitive Landscape - Meta AI claims to have 700 million active monthly users, leveraging its existing user base from its popular applications, which provides a significant advantage over other chatbots [4] - The success of Meta AI will depend on user willingness to download it as a separate app, rather than opting for established competitors like ChatGPT [5][6] Group 3: Financial Considerations - Meta reported over $62 billion in profit last year, a 59% increase year-over-year, despite incurring $18 billion in losses from its Reality Labs division [7] - There are concerns that heavy spending on AI may not guarantee success, as the company has previously pursued trends that did not yield profitable results, such as its metaverse ambitions [8][9] - Currently trading at 26 times its trailing earnings, Meta stock is not considered overly expensive, but the potential for long-term profit growth may be hindered by heavy investments in AI [10]