META - Meta Platforms: Meltdown Was Unwarranted As They Scale AI
2024-04-29 09:00:00 ET
Summary
- Shares of META experienced a significant price decline after the earnings call, but this was an overreaction, and shares have already started to rebound.
- The sell-off was unwarranted as META delivered a double beat and showed tremendous growth, and the revenue forecast should not dictate the share price.
- META faces risks such as regulatory, social, and competition, but it is still positioned for long-term success and has the potential to be a dominant force in AI.
I didn't want to write this article the night of Meta Platforms ( META ) earnings because I wanted to see how the week ended. I am not surprised in the slightest that shares have already started to rebound, as the massive price decline was an overreaction. Shares of META went into the earnings call down -12% and continued falling into the -16% range as Mark Zuckerberg focused heavily on CapEx spending. At one point, shares flirted with breaking through the $400 level and had a fifth of the market cap evaporate in less than an hour. The individuals selling after hours didn't even have time to digest earnings or listen to the call, which I believe will be a mistake. META has been on a phenomenal run, and I can't fault anyone for taking a profit, but after going through the earnings report and the commentary from the conference call, I believe there is a lot of room for shares of META to run going forward....
Meta Platforms: Meltdown Was Unwarranted As They Scale AI