Meta Stock Slides 10% in a Week: Is It a Good Time to Buy?

Meta Stock Gives Up Post-Earnings Gains : Meta Platforms shares have slipped nearly 10% in less than a week, erasing all gains made after its Q4 earnings release. The decline comes amid a broader sell-off in technology and AI-focused stocks, with market sentiment turning cautious.

Valuation Tool — Price-to-Earnings Ratio : After the recent correction, Meta is trading at a price-to-earnings multiple of around 28. This valuation reflects strong growth expectations but also prices in risks linked to heavy spending and margin pressure.

Revenue Growth Tool — Q4 Performance : Meta delivered a strong fourth quarter, with revenue rising 24% year-on-year to USD 59.9 billion. The company also exceeded earnings expectations, supported by higher user engagement and growing advertising demand across its platforms.

User Metrics Tool — Platform Scale and Engagement : Daily active users across Meta’s apps climbed 7% year-on-year to 3.58 billion. Ad impressions increased 18%, driven mainly by higher engagement levels and a steady expansion of the global user base.

Forward Guidance Tool — Q1 Revenue Outlook : Management guided for faster growth ahead, with first-quarter revenue expected to rise about 30% year-on-year at the midpoint. Even after adjusting for currency benefits, growth is projected to remain well above recent levels.

Cost Structure Tool — AI Investment Impact : Meta’s aggressive push into artificial intelligence is driving expenses higher. Costs and expenses surged 40% year-on-year in Q4, pulling operating margins down to 41% from 48% last year. Capital expenditure for 2026 is projected between USD 115 billion and USD 135 billion.

Risk–Reward Tool — Is Meta Stock a Buy? : While Meta’s core business momentum remains strong, near-term earnings growth is under pressure due to massive AI investments. For long-term investors who believe in the company’s AI strategy, the stock may offer an entry opportunity but it remains a high-risk bet that calls for careful position sizing. The above information is based on The Motley Fool report and is for educational purposes only.

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