Meta Platforms(META) The Motley Fool·2025-06-15 16:20Core Viewpoint - Nvidia has been a leading choice for investors in the AI market, with its stock increasing by 1,500% over the past five years due to consistent record revenue growth, indicating strong market dominance and innovation [1] Group 1: Investor Actions - Some billionaires, including Stanley Druckenmiller, David Tepper, and Philippe Laffont, have sold portions of their Nvidia shares to focus on other AI opportunities [2] - Tepper sold 55% of his Nvidia stock, reducing his holdings to 300,000 shares, while increasing his Meta position by 12% to 550,000 shares [6] - Laffont cut his Nvidia position by 14% to 8,545,835 shares and raised his Meta position by 1.9% to 3,757,611 shares, making Meta the largest position in his portfolio [7] Group 2: Meta Platforms' AI Strategy - Meta Platforms is emerging as a favored investment among billionaires, with significant growth in its stock, climbing nearly 300% over the past three years [3][5] - Meta is enhancing its AI capabilities through its large language model, Llama, which aims to drive innovations and maintain its leadership in social media, thereby boosting revenue [8] - The company generates most of its revenue from advertising across its social media platforms and is leveraging AI tools to increase user engagement, encouraging advertisers to invest more [9] Group 3: Financial Outlook and Valuation - Meta is expected to spend up to $72 billion in capital this year to support its AI initiatives, indicating a strong commitment to growth [10] - The stock trades at 27 times forward earnings estimates, which is considered reasonable for a growth stock, especially given its established revenue stream and dividend payments [11] - In the context of the AI boom, investors may consider rotating from Nvidia to Meta, as Meta's AI investments position it well for future gains, with its stock trading at a slightly lower valuation than Nvidia, which trades at 33 times forward earnings estimates [12]