Meta shares are still cheap and worth buying. Here's why
Meta's new model and personal agent app showcase the hidden value inside the social media giant.
Meta Platforms Stock Still Cheap, Analysts Say
Meta Platforms, the owner of Facebook, Instagram and WhatsApp, saw its shares climb 5% on Wednesday after the company rolled out a new artificial‑intelligence model and a personal‑assistant app. Even with that bounce, the stock is down 2% for the year and must gain roughly 22% to return to the September‑2023 peak of about $790.
New AI Model Gains Attention
On Sept. 2 Meta introduced Muse Spark 1.3, a large‑language model that analysts praise for both its low cost and strong performance. The model earned a 48 on the Artificial Analysis Intelligence Index, a score that placed it ahead of OpenAI’s GPT‑5.6 Sol at the time. Although OpenAI’s newer Astra model has since taken the lead, Meta’s AI lab now ranks among the top three in the industry, alongside Anthropic and OpenAI.
Valuation Compared with Peers
When viewed through a sum‑of‑parts lens, Meta’s market price looks especially attractive. FactSet data shows the stock trades at about 19 times 2027 earnings estimates, while the “Family of Apps” segment is expanding revenue at a 20% annual rate and generating robust operating cash flow. By contrast, Anthropic’s last private round valued it at $965 billion, OpenAI at $852 billion and SpaceX at roughly $2 trillion, even though the latter two are not yet profitable on a GAAP basis. Using price‑to‑sales multiples, Meta’s valuation sits near 5.4, far lower than the 15‑30 range for Anthropic, about 21 for OpenAI and roughly 20.6 for SpaceX.
Growth Levers beyond Core Apps
Meta’s AI efforts could add significant upside. The Muse Spark model powers the newly released Muse personal‑assistant app, which debuted on a limited basis Tuesday night. Early users describe it as a “souped‑up Alexa,” and the app integrates tightly with Meta’s three‑billion‑plus global user base across its social platforms. This gives Meta a much larger immediate audience than rivals such as xAI’s GrokBot.
The company also holds a sizable inventory of Nvidia GPUs and is developing custom silicon with Broadcom. While Meta has not announced a public‑cloud business, the hardware could be leased to external customers, a strategy that SpaceX is pursuing with its own compute assets. Even if Meta never launches a cloud service, the optionality of its compute resources should be reflected in its valuation.
Technical Landscape
From a chart perspective, Meta has retaken both its 50‑day moving average near $599 and its 200‑day average around $623, establishing those levels as near‑term support. Resistance appears near $660, a downward‑sloping trend line that has persisted since August 2025. A stronger support zone sits around $550, a level that has held through multiple market stress events over the past year.
Momentum indicators are mixed. The MACD has crossed above its signal line and moved into positive territory, a bullish signal. The Relative Strength Index hovers at about 70, suggesting the stock is approaching overbought conditions, so investors may want to watch for a short‑term pullback.
Bottom Line
Combining a modest price‑to‑sales multiple, a rapidly growing core advertising business, and an AI lab that now competes with the sector’s leading players, Meta Platforms appears undervalued. The recent 5% rally, supportive technical levels and the potential to monetize its compute assets give investors a compelling case to consider adding the stock, provided they are comfortable with the volatility that may accompany the run‑up to the 2028 midterm elections.
Source: CNBC · 2026-09-09