Skip to content S&P 500 6,860.80 -0.13% Dow Jones 47,570.20 -0.11% Nasdaq 100 25,991.20 -0.16% Russell 2000 2,475.91 +0.52% FTSE 100 9,716.00 -0.52% Nikkei 225 52,423.70 +1.58% Stock Market Live October 31: S&P 500 (SPY) Soaring on Amazon and Apple Earnings Home >Investing >Opinion: Meta Stock's Post-Earnings Plunge is a Golden Opportunity to Buy Investing Opinion: Meta Stock's Post-Earnings Plunge is a Golden Opportunity to Buy ByJoey Frenette Oct 31, 2025 10:31 am This post may contain links from our spon ...

Core Insights - Meta Platforms is committing $65 billion towards establishing AI infrastructure dominance, which reflects a significant strategic pivot beyond social media [1][3][11] - The investment aims to create personal superintelligence, a context-aware assistant integrated into daily life, potentially revolutionizing user interaction with technology [4][5][11] User Base and Engagement - Meta's user base consists of 3.48 billion monthly active users across its Family of Apps, representing nearly half of the connected world [3] - Existing AI tools are already generating substantial revenue, with AI-driven ad tools contributing $60 billion annually and improvements in Reels pushing a $50 billion run-rate [6] Competitive Landscape - The corporate AI arms race is a central threat, with competitors like Google, Microsoft, and Amazon making significant investments in AI, which could decouple Meta from its user base [7][8][9] - The competition has shifted from social media features to owning the next generation of digital interfaces, posing a structural threat to Meta's core advertising revenue [9][10] Analyst Perspective - Analysts express confusion regarding Meta's vision, indicating a knowledge gap that leaves investors uncertain about the implications of the company's strategic direction [2][10] - The current focus on short-term capital expenditures overlooks the existential threat posed by user displacement in an AI-first world [10]

Core Insights - Financial giants are showing a bearish sentiment towards Meta Platforms, with 49% of traders indicating bearish tendencies and only 31% bullish [1] - The analysis of options trading reveals a significant focus on a price range between $380.0 and $1300.0 for Meta Platforms over the last three months [2] - Recent options trading data indicates a total of 132 unusual trades, with 51 puts valued at $6,964,907 and 81 calls valued at $7,841,912 [1] Options Trading Analysis - The volume and open interest metrics are crucial for understanding liquidity and investor interest in Meta Platforms' options, particularly within the strike price range of $380.0 to $1300.0 over the past 30 days [3] - Significant options trades include a bullish put sweep with a total trade price of $3.2 million and a bearish call sweep with a total trade price of $304.1K [8] Company Overview - Meta Platforms is the largest social media company globally, with nearly 4 billion monthly active users, operating key applications like Facebook, Instagram, Messenger, and WhatsApp [9] - The company's core business model involves leveraging user data to sell advertisements, while its Reality Labs division, although heavily invested in, remains a minor contributor to overall sales [9] Analyst Ratings - Recent analyst ratings for Meta Platforms show a mixed sentiment, with an average target price of $835.0 from five experts, while individual ratings range from a Buy at $900 to a downgrade to Strong Buy at $825 [11][12]

Core Insights - The technology sector is experiencing a confidence boost, driven by strong earnings from major companies like Amazon and Apple [1][2] - There is a noticeable sector rotation occurring, with investors shifting focus from technology to financial and pharmaceutical sectors [3] - The market is still processing the implications of the recent Federal Reserve meeting, particularly regarding potential rate cuts [3] Company Performance - Amazon reported strong earnings, significantly aided by its AWS segment, which exceeded expectations [1][4] - Apple also surpassed expectations with iPhone sales, contributing positively to market sentiment [1] - Alphabet achieved a 2.5% gain due to robust performance in advertising and cloud services, reporting quarterly earnings of $100 billion [2] - META Platforms faced a decline of over 11% due to rising expenses and a one-time tax charge of $16 billion [2] - Chipotle Mexican Grill saw an 18.2% drop, attributed to struggles with the 25–34-year-old customer demographic and a lowered yearly outlook [2] - Exxon Mobil Corporation's earnings slightly missed expectations, continuing a year-over-year decline due to lower crude oil prices [2] - Chevron Corporation's earnings also fell year-over-year but exceeded estimates, resulting in a mostly unchanged stock price [2] Market Trends - Investor expectations are shifting, with a rotation from a heavily weighted tech sector to financial and pharmaceutical sectors [3] - A fragile "trade truce" between the US and China is being monitored, as it raises concerns within the investing community [3] - The probabilities of a December rate cut are evolving, influenced by comments from the Federal Reserve [3]

Group 1 - Meta Platforms, Inc. reported better-than-expected revenue, but earnings were significantly impacted by a one-time tax hit from the president's One Big Beautiful Bill Act, leading to a substantial earnings miss [1] - Without the one-time tax impact, Meta would have earned $7.25 per share, indicating strong underlying performance [1] - The company is heavily investing in AI, which is seen as a key area for future growth and differentiation from competitors [1] Group 2 - Meta develops a range of products that facilitate communication and connection through social media and various messaging platforms, including Facebook, Instagram, Messenger, Threads, WhatsApp, and related hardware and software [2] - The potential of Meta as an investment is acknowledged, but there are opinions that other AI stocks may offer greater upside potential with less downside risk [3]

The Reddit stock price popped by over 10% in the extended hours after the company published strong financial results and boosted its forward estimates. It jumped to a high of $2[4, up by 175% from its... ...

Core Viewpoint - Meta Platforms (META) stock experienced an 11.3% decline in a single day due to investor concerns over the company's plans to significantly increase capital spending to support its AI compute needs [1] Financial Overview - Meta Platforms is currently valued at $1.7 trillion, with a revenue of $189 billion and a stock price of $666.47 [7] - The company has shown a revenue growth of 21.3% over the last 12 months and maintains an operating margin of 43.2% [7] - The stock is trading at a P/E multiple of 28.7 and a P/EBIT multiple of 19.7 [7] - The company has a Debt to Equity ratio of 0.03 and a Cash to Assets ratio of 0.15 [7] Stock Performance - META stock declined 76.7% from a high of $382.18 on September 7, 2021, to $88.91 on November 3, 2022, while the S&P 500 saw a peak-to-trough decrease of 25.4% during the same period [8] - The stock fully regained its pre-Crisis peak by January 19, 2024, and reached a high of $790.00 on August 12, 2025, currently trading at $666.47 [8] - Historical performance indicates that META stock has shown a median return of 74.5% within a year after significant drops since 2010 [7] Investment Strategy - The Trefis High Quality Portfolio is suggested as a diversified investment strategy to mitigate stock-specific risks while providing upside potential [4] - The performance of META stock during economic recessions has been worse than the S&P 500, indicating the importance of assessing downturn resilience [3][9]

Core Insights - The Magnificent Seven (Mag 7) companies are crucial to the S&P 500's tech exposure, contributing to about one-fourth of all S&P 500 earnings [1] - Excluding the Mag 7 group's earnings, the S&P 500 index's Q3 earnings would show a 6.1% increase year-over-year, compared to a 7.3% increase including the Mag 7 [1] Group Performance - The Mag 7 group's Q3 earnings are projected to rise by 11.5% year-over-year, driven by a 15.4% increase in revenues, following a previous quarter's earnings growth of 26.4% on 15.5% revenue growth [2] - Amazon (AMZN) reported stronger-than-expected Q3 results, with revenues and profits exceeding estimates, leading to a pre-market surge of over 12% [2] - Apple (AAPL) shares increased by 1.9% after reporting Q4 results that surpassed earnings and revenue estimates, although iPhone sales and China revenues fell short of expectations [3][4] - Microsoft reported fiscal Q1 results that exceeded expectations, with a 40% increase in its Azure cloud business, although shares fell nearly 3% due to hints of increased capital expenditures [5] - Meta (META) experienced an 11.3% drop in shares despite beating revenue estimates, attributed to a significant tax charge impacting earnings [6][7] - Alphabet (GOOGL) shares rose by 2.5% after surpassing revenue and earnings estimates, with Google Cloud revenues increasing by 33.5% [8] Future Outlook - Meta anticipates "notably larger" capital expenses next year due to substantial investments in AI, adjusting its capex guidance to between $70 billion and $72 billion [7] - NVIDIA (NVDA) is set to report earnings on November 19, 2025, and has recently achieved a $5 trillion market cap, supported by various partnerships and projects in AI and robotics [10][11] - The overall sentiment among the Mag 7 companies reflects a strong commitment to AI investments, with many companies, including Amazon, Alphabet, and Microsoft, planning aggressive capital expenditures [12][13] Investment Opportunities - ETFs such as Roundhill Magnificent Seven ETF (MAGS), MicroSectors FANG+ ETN (FNGS), Vanguard Mega Cap Growth ETF (MGK), and Invesco S&P 500 Top 50 ETF (XLG) are highlighted as potential investment vehicles, with MAGS outperforming the S&P 500 despite recent market fluctuations [14]

We recently published 10 Stocks Moving on Buzzing News as Analyst Issues Strong Warning About AI Valuations. Meta Platforms, Inc. (NASDAQ:META) is one of the stocks moving on buzzing news. Stephanie Link, the Chief Investment Strategist, Head of Investment Solutions and Portfolio Manager at Hightower Advisors, said in a recent program on CNBC that she likes Meta amid increasing efficiency and margins. Here is what the analyst said: “Meta Platforms Inc (NASDAQ:META) is growing 20%. Operating margins last ...

Corporate Earnings - Companies in the S&P 500 are expected to post an average +7.2% increase in quarterly earnings for Q3 compared to the previous year, marking the smallest rise in two years [2] - Meta Platforms (META) reported weaker-than-expected Q3 EPS and raised its full-year total expense forecast, leading to a plunge of over -11% [3] - Microsoft (MSFT) fell nearly -3% after its Azure cloud-computing unit's revenue growth failed to meet expectations [3] - Chipotle Mexican Grill (CMG) tumbled over -18% after cutting its full-year comparable restaurant sales guidance [3] - C.H. Robinson Worldwide (CHRW) soared more than +19% after posting better-than-expected Q3 adjusted EPS and raising its 2026 operating income guidance [3] - Amazon.com (AMZN) jumped over +12% in pre-market trading after posting the strongest growth rate in nearly three years in its cloud unit and issuing solid Q4 revenue guidance [4][18] - Apple (AAPL) rose more than +1% in pre-market trading after reporting better-than-expected FQ4 results and providing an upbeat sales forecast for the holiday quarter [4][18] - Western Digital (WDC) surged more than +10% in pre-market trading after posting upbeat FQ1 results and issuing strong FQ2 guidance [19] Economic Indicators - The U.S. government shutdown has entered its 31st day, delaying the publication of key economic data including the September core PCE price index and Personal Spending [6] - The Congressional Budget Office stated that the four-week government shutdown will trim real annualized GDP growth by 1 percentage point this quarter [7] - Economists forecast the October Chicago PMI at 42.3, compared to the previous value of 40.6 [6] - Eurozone's October CPI rose +2.1% y/y, in line with expectations, while the Core CPI rose +2.4% y/y, stronger than expectations of +2.3% y/y [12] Market Sentiment - U.S. rate futures have priced in a 68.8% chance of a 25 basis point rate cut at the December FOMC meeting [8] - The Euro Stoxx 50 Index is down -0.37% amid profit-taking and fresh corporate earnings reports [9] - Japan's Nikkei 225 Stock Index closed sharply higher, hitting a new record high, supported by strong earnings from domestic companies and a weaker yen [15]