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META: Liquidity, Growth and AI Fuel Institutional Appetite
Zacks Ranks #3 (Hold) stock Meta Platforms is the world’s largest social media platform.With social media powerhouses like Instagram and Facebook under its umbrella, the company is benefiting from increasing ad revenue.
Additionally, Meta is working on growing and monetizing WhatsApp, the world’s largest messaging app. More than 3 billion people use Meta’s family of products on a daily basis. Though Meta faces intense competition from Alphabet, Twitter, Amazon and Snap, the company continues to gain market share.
With double-digit EPS and revenue growth, it’s difficult for investors to find a company growing as fast, consistently, and with such liquidity as Meta. Because META enjoys this rare trifecta, institutional investors are likely to remain attracted to this ‘hedge fund hotel.’
Meta Benefits from AI Now and into the Future
Meta Platforms is expected to spend roughly $70 billion in CAPEX in 2025 to boost its AI ambitions. While the spending may seem reckless to Wall Street due to the sheer size, META is already enjoying significant returns on its AI investments, unlike most AI companies. In Meta’s recent earnings conference call, visionary CEO Mark Zuckerberg featured five ways AI will drive META, including:
“Improved advertising, more engaging experiences, business messaging, Meta AI, and AI devices.”
AI is driving increased time spent on its core social media offerings. AI optimization has led to a 5% increase in time spent on Facebook and a 6% increase on Instagram – leading to better returns for Meta’s ad business (which makes up ~97% of revenue). Meanwhile, Zuckerberg made a shocking forward-looking statement that suggests that his company’s AI is the best or near the best, saying:
“Developing superintelligence – which we define as AI that surpasses human intelligence in every way – we think is now in sight.”
META: Post Earnings Drift Set-up
Last week, META blew away Wall Street EPS expectations, marking the company’s eleventh consecutive earnings beat.
Following its earnings beat last week, META shares bolted more than 11% as volume swelled to 220% above the norm. Heavy volume and robust price action of this magnitude signal heavy institutional accumulation among investors. Additionally, because these institutional investors usually buy for weeks and months at a time, I expect META to benefit from being a classic ‘post-earnings drift’ play.
Bottom Line
Meta is one of the rare companies already benefiting from its AI investments. The company is being driven by strong performance across its social media platforms, with consistent growth in both revenue and earnings per share.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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Zacks Investment Ideas feature highlights: Meta Platforms, Alphabet, Amazon and Snap
For Immediate Release
Chicago, IL – August 5, 2025 – Today, Zacks Investment Ideas feature highlights Meta Platforms (META - Free Report) , Alphabet (GOOGL - Free Report) , Amazon (AMZN - Free Report) and Snap (SNAP - Free Report) .
META: Liquidity, Growth and AI Fuel Institutional Appetite
Zacks Ranks #3 (Hold) stock Meta Platforms is the world’s largest social media platform.With social media powerhouses like Instagram and Facebook under its umbrella, the company is benefiting from increasing ad revenue.
Additionally, Meta is working on growing and monetizing WhatsApp, the world’s largest messaging app. More than 3 billion people use Meta’s family of products on a daily basis. Though Meta faces intense competition from Alphabet, Twitter, Amazon and Snap, the company continues to gain market share.
Meta: Liquidity + Fast, Consistent Growth = Institutional Appetite
With double-digit EPS and revenue growth, it’s difficult for investors to find a company growing as fast, consistently, and with such liquidity as Meta. Because META enjoys this rare trifecta, institutional investors are likely to remain attracted to this ‘hedge fund hotel.’
Meta Benefits from AI Now and into the Future
Meta Platforms is expected to spend roughly $70 billion in CAPEX in 2025 to boost its AI ambitions. While the spending may seem reckless to Wall Street due to the sheer size, META is already enjoying significant returns on its AI investments, unlike most AI companies. In Meta’s recent earnings conference call, visionary CEO Mark Zuckerberg featured five ways AI will drive META, including:
“Improved advertising, more engaging experiences, business messaging, Meta AI, and AI devices.”
AI is driving increased time spent on its core social media offerings. AI optimization has led to a 5% increase in time spent on Facebook and a 6% increase on Instagram – leading to better returns for Meta’s ad business (which makes up ~97% of revenue). Meanwhile, Zuckerberg made a shocking forward-looking statement that suggests that his company’s AI is the best or near the best, saying:
“Developing superintelligence – which we define as AI that surpasses human intelligence in every way – we think is now in sight.”
META: Post Earnings Drift Set-up
Last week, META blew away Wall Street EPS expectations, marking the company’s eleventh consecutive earnings beat.
Following its earnings beat last week, META shares bolted more than 11% as volume swelled to 220% above the norm. Heavy volume and robust price action of this magnitude signal heavy institutional accumulation among investors. Additionally, because these institutional investors usually buy for weeks and months at a time, I expect META to benefit from being a classic ‘post-earnings drift’ play.
Bottom Line
Meta is one of the rare companies already benefiting from its AI investments. The company is being driven by strong performance across its social media platforms, with consistent growth in both revenue and earnings per share.
Free: Instant Access to Zacks' Market-Crushing Strategies
Since 2000, our top stock-picking strategies have blown away the S&P's +7.7% average gain per year. Amazingly, they soared with average gains of +48.4%, +50.2% and +56.7% per year.
Today you can tap into those powerful strategies – and the high-potential stocks they uncover – free. No strings attached.
Get all the details here >>
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.