Meta Platforms (META 1.93%), one of the leading social media companies, went public in 2012. Since then, the stock has performed exceptionally well. Its returns over this period are well above those of broader equities. However, some might argue that it’s too late to get in on the bandwagon.

Meta Platforms is now worth almost $2 trillion. Can the stock still generate life-changing returns? Let’s find out.

The bullish case for Meta Platforms

Meta’s bread and butter is advertising. The company boasts a portfolio of social media brands that includes Facebook, Instagram, Messenger, and WhatsApp. It has more than 3 billion daily active users across these platforms as of the end of the second quarter of 2025. The sheer volume of Meta’s ecosystem makes it an attractive place to run ads, but the company goes even further.

It has access to a considerable amount of data from its users, including basic demographic information, interests, favorite celebrities, and much more. This enables the company to assist businesses in crafting ads that are carefully targeted toward specific audiences, making them highly cost-effective.

Meta Platforms’ strategy has been successful, as evidenced by its financial results. Second-quarter revenue increased 22% year over year to $47.5 billion, while earnings per share came in at $7.14, 38% higher than the year-ago period.

Image source: Getty Images.

The company’s core advertising business will remain central to its results for the foreseeable future. And here is the good news: Meta is improving its ad business thanks to artificial intelligence (AI). On the one hand, it helps improve the ad launch process with AI-powered tools that assist businesses in crafting ads, including by generating relevant messages and images and further enhancing targeting. On the other hand, AI-powered algorithms are boosting engagement on the company’s websites and apps.

The result: Time spent on Facebook and Instagram has increased lately. And according to a study the company ran, AI-powered ad tools improved return on ad spend by 22%.Meta is looking to automate the ad process completely, which should lead to even greater gains. The company could perform well as it moves toward that goal. But what happens beyond advertising?

In my view, Meta Platforms’ greatest strength is its ecosystem and culture of innovation. With several billion users, the tech giant can develop various monetization schemes, only a few of which need to take off to have a meaningful impact on its financial results. Meta is gradually expanding into other avenues, including paid messaging on WhatsApp. The company is investing in AI glasses, which CEO Mark Zuckerberg believes will become the norm within the next decade.

Thanks to its core business, its vast ecosystem, and various other initiatives, Meta could still deliver market-beating returns over the next 20 years.

Some risks to consider

Meta Platforms may encounter some obstacles. For instance, the company is spending a small fortune on AI infrastructure. That could be a problem if its AI initiatives don’t have the impact it hopes they will, especially if we enter an economic recession. Consumers spend less — and so do businesses, including on advertising — when the economy is struggling. The combination of slower revenue growth (if ad spending decreases) and increased expenses due to Meta’s investments in AI could harm the company’s financial results.

Antitrust lawsuits could present another potential threat to Meta Platforms. Regulators in the U.S. have argued that Meta has a monopoly in the social networking space. These lawsuits are still ongoing. In the worst-case scenario, Meta may be forced to divest some of its assets. Do these potential challenges justify avoiding the stock? Not in my view. Meta proved it could navigate economic challenges a couple of years ago.

Amid growing expenses, declining user growth, and slower revenue increases, the company regrouped, cut costs, and emerged from the ordeal stronger than ever. Meta’s AI plans are, so far, yielding tangible results, and we haven’t seen all that the company can do in this area yet.

Regarding the company’s legal problems, while it’s worth keeping an eye on those, a potential and uncertain worst-case scenario shouldn’t deter investors from this robust, well-run business that is firing on all cylinders. It might be worth revisiting the question if Meta loses its antitrust case, but the stock’s prospects remain highly attractive as things stand.

Lastly, Meta is now a dividend stock — a fairly new development — and reinvesting the payout will boost what should already be superior returns over the long run. So can Meta Platforms set investors up for life? I think it can.

Interest in artificial intelligence went parabolic following the release of ChatGPT in late 2022. Since then, Nvidia stock has advanced 1,090% to a market value of $4.2 trillion. And Palantir Technologies stock has climbed 2,340% to a market value of $370 billion. That means the companies are collectively worth $4.6 trillion.

I predict Meta Platforms (META -1.69%) will surpass that figure in no more than five years (i.e., before the end of 2030). The company is currently worth $1.9 trillion, which means its share price must increase by about 247% for its market value to reach $4.7 trillion. Here’s why I think that could happen.

Image source: Getty Images.

Meta Platforms is a digital advertising giant with deep AI expertise

Meta Platforms owns three of the four most popular social media platforms as measured by monthly active users. That competitive advantage lets it collect consumer data on a tremendous scale, and that data helps brands target ad campaigns. As a result, Meta is the second-largest adtech company worldwide and is likely to gain market share, according to Morningstar.

Meta has already made strides in boosting engagement with artificial intelligence (AI). CEO Mark Zuckerberg told analysts on the second-quarter earnings call, “Advancements in our recommendation systems have improved quality so much that it has led to a 5% increase in time spent on Facebook and 6% on Instagram.” He also said that advertising conversion rates increased across both social media platforms, meaning more clicks and purchases.

Importantly, Meta is investing aggressively in AI infrastructure and aspires to automate the entire ad creation process by next year. The Wall Street Journal writes, “Using the ad tools Meta is developing, a brand could present an image of the product it wants to promote along with a budgetary goal, and AI would create the entire ad, including imagery, video, and text.”

Meta’s Orion smart glasses could be the next big consumer electronics product

Meta Platforms is the market leader in smart glasses, a nascent market where shipments more than tripled last year and are forecast to increase faster than 60% annually through 2029. And Meta is actually gaining market share. Its Ray-Ban smart glasses accounted for nearly three-quarters of shipments in the first half of 2025, up from 60% in 2024.

Counterpoint Research writes, “Ray-Ban Meta smart glasses redefine the smart glasses experience by integrating wearable AI while combining a stylish design with enhanced smart functionalities.” The company sees a large opportunity on the horizon. Zuckerberg believes smart glasses could replace smartphones as the personal computing form factor of choice within the next 15 years.

To capitalize, Meta announced Orion last year, smart glasses that incorporate augmented reality (AR) that overlays the physical world with holographic displays. The company will not commercialize the product for several years while it works to make the technology less expensive. However, smart glasses that blend AR and AI could be revolutionary, as they would enable wearers to search the internet, talk with friends, and watch media content without phones.

Apple rose to great heights following its introduction of the iPhone in 2007. If Zuckerberg is correct about smart glasses being the next big breakthrough in consumer electronics, Meta could become the Apple of the next decade, which means its market value could increase substantially in the years ahead.

Meta Platforms could be a $4.7 billion company by mid-2030

To summarize, Meta has a strong presence in digital advertising and a leadership position in smart glasses. Adtech spending is forecasted to grow at a rate of 14% annually through 2032, while smart glasses sales are projected to increase by more than 60% annually through 2029. In total, that gives Meta a reasonable shot at annual earnings growth of 20%+ in the next five years.

That outlook makes the current valuation of 26.7 times earnings seem quite reasonable. And if Meta does grow earnings at 20% annually over the next five years, its share price could increase by 149% without any change in the price-to-earnings (P/E) ratio. That would bring its market value to $4.7 trillion by mid-2030, surpassing the current combined market value of Nvidia and Palantir.

The stocks of Google parent Alphabet (GOOGL 3.10%) (GOOG 2.98%) and Meta Platforms (META 2.04%) shot higher in Friday trading. Although most stocks rose because the Federal Reserve strongly hinted at a September cut in interest rates, another factor was likely the announcement of Meta’s cloud deal with Google, as reported by The Information.

Considering the $10 billion size of the deal, one has to assume it is critical, particularly to Alphabet. Still, considering the state of the artificial intelligence (AI) stock, it could serve as a much-needed catalyst for the company’s investors. Here’s why.

Image source: Getty Images.

Terms of the partnership

Under the terms of the deal, Meta will pay Google $10 billion over six years. In exchange, it will receive access to Google Cloud’s storage, server, and networking services, along with other products.

Meta has previously relied on Amazon‘s Amazon Web Services (AWS) and Microsoft‘s Azure for such services. The deal does not necessarily mean it will deal less with these companies. More likely, it speaks to Meta’s insatiable demand for cloud infrastructure as it seeks to become a major player in the AI space.

Additionally, Meta and Alphabet are each other’s largest competitors in the digital advertising market. And in the first half of 2025, 98% of Meta’s revenue came from digital ads. Hence, in a sense, it is remarkable that these two would become partners in a different business.

How it helps Alphabet

However, in another sense, this is a huge step forward for Alphabet’s future. In the first half of this year, Alphabet earned 74% of its revenue from the digital ad market, down from 76% in the same period in 2024. This is also by design, as Alphabet has purchased dozens of businesses unrelated to the digital ad market in its efforts to transition into a more diversified technology enterprise.

So far, Google Cloud is the only one of these enterprises to appear in Alphabet’s financials. It accounted for 14% of Alphabet’s revenue in the first two quarters of 2025, up from 12% in the same year-ago period.

Additionally, Google Cloud generated over $49 billion in revenue over the trailing 12 months, implying the $10 billion from Meta over six years will make up a relatively small portion of Google Cloud’s business.

Nonetheless, the deal serves as a vote of confidence for Alphabet’s cloud business, one that continues to lag AWS and Azure in terms of market share.

Image source: Statista. Y-o-y = year over year.

The investor perspective is also crucial. Over the last year, Alphabet stock has outpaced the total returns of the S&P 500 by a significant but not eye-popping margin. However, it may help that Alphabet’s price-to-earnings (P/E) ratio of 22 is the lowest among “Magnificent Seven” stocks. Hence, the Meta deal could prompt investors to look more favorably upon that earnings multiple.

GOOGL Total Return Level data by YCharts.

Furthermore, if the Meta deal prompts other companies to do more business with Google Cloud, it could provide a boost to its market share and, by extension, Alphabet stock.

The Meta deal and Alphabet stock

Ultimately, Meta’s deal with Google Cloud will more than likely take Alphabet stock a leg higher, but investors should expect the effects to be more indirect. Indeed, the deal is remarkable in that it serves as a boost for third-place Google Cloud and is notable since the two companies are direct competitors in each other’s largest enterprises.

Although $10 billion in added business over six years is substantial, Google Cloud generated $49 billion over the last 12 months. Thus, it is a significant but not game-changing boost to the enterprise.

However, the deal may make Google Cloud more attractive to prospective customers, and the low P/E ratio could attract more investors to Alphabet. In the end, those could become the more significant benefits of the deal.

Eight American companies are valued at $1 trillion or more, but only three graduated into the ultra-exclusive $3 trillion club: Nvidia, Microsoft, and Apple. I think Meta Platforms (META 3.49%) could join them.

Meta owns social media platforms Facebook, Instagram, and WhatsApp, but it has also become a clear leader in the artificial intelligence (AI) race thanks to its Llama family of large language models (LLMs), which are among the most powerful in the industry.

Meta stock soared by 11% on July 31, after the company reported a stellar set of operating results for the second quarter of 2025 (which ended on June 30). The move lifted its market capitalization to almost $2 trillion, meaning investors who buy the stock today could earn a return of 50% if it ascends into the $3 trillion club. Here’s why I think it will get there sooner rather than later.

Image source: Getty Images.

AI is supercharging Meta’s business

Almost 3.5 billion people were using at least one of Meta’s social media apps every day during the second quarter of 2025. As that figure approaches half of the global population, it will become harder to attract new users, which will have consequences for the company’s advertising revenue in the future. However, Meta can also generate more advertising dollars by increasing the amount of time each user spends on its apps, and AI is central to that strategy.

Meta’s recommendation engine uses AI to learn what type of content each user enjoys viewing, and then it feeds them more of it. CEO Mark Zuckerberg said this resulted in a 6% increase in the amount of time users spent on Instagram during the second quarter, and a 5% increase on Facebook. Simply put, the longer each user spends online, the more ads they see, and the more money Meta makes.

AI also boosts the efficiency of Meta’s ad-recommendation model by targeting users more accurately, which led to a 5% increase in conversions on Instagram during the second quarter and a 3% increase on Facebook. Businesses will normally pay more money per ad when conversions are increasing, which is another big tailwind for Meta.

Higher engagement and more conversions sent Meta’s second-quarter revenue soaring 22% year over year to $47.5 billion, which was comfortably above the company’s forecast range of $42.5 billion to $45.5 billion. Management also issued bullish guidance for the third quarter (which ends on Sept. 30), telling investors the company’s revenue could top $50 billion for the first time ever.

Zuckerberg says AI superintelligence is in sight

Meta launched its Llama family of LLMs in early 2023. They are open source so Meta leans on a community of millions of developers to troubleshoot technical issues, which is why they have caught up to the best closed-source models so quickly. The latest Llama 4 models now rival the most advanced releases from top start-ups like OpenAI and Anthropic.

Meta is using the Llama models to power new features across its social media apps, which is another way it’s boosting engagement. The Meta AI chatbot, for instance, already has over 1 billion monthly active users who tap into its capabilities for homework assistance, image generation, and everything in between.

Zuckerberg says AI superintelligence — which is when AI models surpass human intelligence by every metric — is now in sight. Whoever reaches this milestone first could have a significant advantage over every other AI developer, which is why Zuckerberg recently established a new division called Meta Superintelligence Labs. Scale AI founder Alexandr Wang will lead the team, after selling 49% of his company to Meta in a $14 billion deal in June.

But achieving superintelligence won’t be cheap. Meta allocated $17 billion to capital expenditures (capex) during the second quarter alone, most of which went toward building data center infrastructure and buying chips from suppliers like Nvidia. The company also increased its capex forecast for 2025; it now expects to spend between $66 billion to $72 billion, up from $64 billion to $72 billion previously.

The gigantic capex spending could dent Meta’s profitability in the short term, but the company hopes it will lead to accelerated growth over the long run as AI (and potentially superintelligence) improves user engagement and ad conversions even further.

Meta has a clear path to the $3 trillion club

Fortunately, Meta’s strong beat at the top line led to a very strong result at the bottom line during the second quarter. Its earnings per share (EPS) soared by 38% year over year to $7.14, crushing Wall Street’s estimate of $5.92. It carried the company’s trailing-12-month EPS to $27.62, which places its stock at a price-to-earnings (P/E) ratio of just 28.

That’s a noteworthy discount to the Nasdaq-100 index, which is trading at a P/E ratio of 32.7, and it’s an even steeper discount to the median P/E ratio of the “Magnificent Seven” stocks, which stands at 38.1. The Magnificent Seven (which includes Meta) is an elite group of technology companies operating on the front lines of the AI industry.

PE Ratio data by YCharts

Therefore, despite logging an eye-popping 200% gain over the last five years alone, Meta stock might still be undervalued. It would have to rise by a further 36.1% just to trade in line with the median P/E ratio of the Magnificent Seven, which would catapult its market cap to almost $2.7 trillion. At that point, Meta’s annualized EPS would have to grow by just 11% to push its market cap above $3 trillion.

Meta grew its EPS at a compound annual rate of 36% during the recent decade between 2014 and 2024. That growth rate is unsustainable over the long term for any company, but Meta’s EPS soared at an above-trend pace of 37% during the first quarter of 2025, and then 38% in the second quarter, so it should have no trouble mustering 11% growth over the next year or two.

Even if Meta’s P/E ratio holds steady at 28 — which I predict is unlikely because it seems so cheap — it’s only a matter of time before the company’s rapid earnings growth carries it into the exclusive $3 trillion club.

• Meta Platforms CEO Mark Zuckerberg spent a lot of time during the past few months building his news superintelligence AI team. 

Meta Platforms CEO Mark Zuckerberg expects to deliver “personal superintelligence for everyone” but his ambitious bets on AI are impacting the company’s cash flows and are likely to hit expenses even harder as Meta soups up its AI capabilities and continues its hiring spree. 

Mark Zuckerberg has named Shengjia Zhao, an artificial intelligence researcher who joined Meta Platforms Inc. from OpenAI in June, as the chief scientist for the social media company’s new superintelligence AI group. 

If you have $50,000 to invest, you’re in a good position. That’s enough to make a significant difference for your retirement or whatever else you’re investing for.

With $50,000 to invest, you’ll likely want to find stocks that can deliver growth, but with relatively low risk. Luckily, there are a number of stocks available on the market that embody those characteristics. Keep reading to see two of them.

Image source: Getty Images.

1. Meta Platforms

Meta Platforms (META -1.88%) may be the best example of a business that can burn through billions in cash on a side project, but is still overwhelmingly successful.

Meta has lost more than $60 billion on its metaverse and artificial intelligence (AI)-focused division, Reality Labs. But the success of its advertising business and the growth of its family of apps division has more than made up for it.

Over the last three years, the stock is up more than 300%. It’s fended off a threat from TikTok with its Reels. Meta’s AI tools are also helping the company better monetize its ad inventory and help its advertisers use AI for images and ad copy.

Meta effectively has a duopoly in digital advertising with Alphabet, but it’s outgrowing its large rival. In the first quarter, revenue jumped 16% to $42.3 billion, and Meta reported an operating profit of $17.5 billion, or an operating margin of 41%.

The company benefits from a dream business model where it sells ads on user-generated content, and has more than 3 billion daily active users across its apps, primarily including Facebook and Instagram.

Meta’s wide-moat advantage in digital advertising and social media isn’t likely to go anywhere, and the business should continue to experience solid growth as long as the economy is healthy.

Meta is also a top AI competitor. Meta AI’s chatbot now has nearly 1 billion users, giving it the biggest user base of any AI platform. The company’s deal with Scale AI should also accelerate its AI ambitions.

Finally, the stock trades at a price-to-earnings ratio of 27, which looks like a great valuation for a company growing at its pace.

Overall, Meta combines solid growth, wide profit margins, a strong competitive advantage, and a good valuation, making it a great stock for a large investment. The company looks like a good bet to continue outperforming the market at relatively low risk.

2. Axon Enterprise

Axon Enterprise (AXON 0.79%) may not be a household name the way Meta is, but it similarly dominates its niche of law enforcement technology.

Axon makes Taser electrical weapons, body and dashboard cameras, and software systems that help law enforcement agencies make use of the data the cameras generate.

The complementary hardware and software products have created a strong moat for Axon, and its stock has gained more than 2,000% over the last decade.

These days, Axon is expanding beyond its traditional core in law enforcement into private sector businesses like packaged delivery companies. In fact, its biggest contract in 2024 was with a large logistics company, which demonstrates that there are applications for its camera systems beyond law enforcement.

The company also released a generative-AI product called Draft One, which writes first drafts of police reports based on camera footage. The product has been well-received by law enforcement as it’s saving valuable time, allowing officers to focus on more pressing matters.

Axon continues to deliver strong growth, with revenue up 31% to $604 million in the first quarter. It reported adjusted net income of $115 million, showing that it’s growing fast and has wide profit margins.

The company also raised its full-year revenue guidance from $2.55 billion to $2.65 billion to $2.6 billion to $2.7 billion, showing confidence in its growth the rest of the year.

With little direct competition across its product portfolio, Axon looks poised for more long-term tailwinds due to its innovation and growth in new markets like logistics.

Nvidia (NVDA -2.20%) has been a no-brainer choice for investors aiming to win in the artificial intelligence (AI) market. The stock has soared 1,500% over the past five years as this AI chip leader delivered quarter after quarter of record revenue growth — and this story is far from over. Nvidia’s market dominance and innovation should help it to benefit as the AI boom continues.

But some billionaires have decided to move on, selling some or all of their Nvidia shares and focusing on other potential AI winners. For example, Stanley Druckenmiller of the Duquesne Family Office sold all his Nvidia shares in the third quarter of last year. Just recently, David Tepper of Appaloosa and Philippe Laffont of Coatue Management cut their positions in Nvidia.

As some investors reduce exposure to the top chipmaker, another AI stock, one that’s climbed nearly 300% over the past three years, is emerging as an investor favorite. Let’s check it out.

Image source: Getty Images.

Among the top five

The stock I’m talking about is among the top five stock holdings of Tepper, and it’s the No. 1 stock holding of Laffont, as well as fellow billionaires Chase Coleman of Tiger Global Management and Stephen Mandel Jr. of Lone Pine Capital. Ole Andreas Halvorsen of Viking Global Investors is also bullish on this stock, opening a position in the first quarter of this year.

This player that’s been much sought after by billionaires in recent times is Meta Platforms (META -1.70%), a company you are probably very familiar with thanks to its social media dominance. Meta owns Facebook, Messenger, Instagram, and WhatsApp — more than 3.4 billion people worldwide use at least one of these apps daily.

Here’s how billionaires Tepper, who oversees $8.3 billion, and Laffont, who manages $22 billion, took action on Nvidia and Meta in the first quarter:

• Tepper sold 55% of his Nvidia stock and now holds 300,000 shares. He increased his Meta position by 12% to 550,000 shares. It’s his fifth-biggest stock position.
• Laffont cut his Nvidia position by 14% to 8,545,835 shares. He lifted his Meta position by 1.9% to 3,757,611 shares. As mentioned above, Meta is the biggest position in his portfolio.

Building AI expertise

Considering these moves and Meta’s top spot in the portfolios of other billionaires, it’s clear these expert investors see the company as a potential winner in the AI revolution. You may be wondering why this is the case, given that Meta is best known for its strengths in the social media industry. Well, Meta has also been building AI expertise in the form of its own large language model (LLM), Llama, to power innovations that may ensure its leadership in social media — and, therefore, revenue growth.

Here’s how that works. Meta generates the lion’s share of its revenue from advertisers across its social media apps. And through tools like AI assistants, Meta aims to keep us spending more time on the apps, prompting advertisers to pour more investment into advertising there to reach us. Meta AI, the company’s current offering, is currently the world’s most widely used AI assistant.

On top of this, Meta’s innovations in AI could lead to other products and services that boost revenue down the road. Meta clearly believes in the saying “go big or go home,” as the company expects to reach as much as $72 billion in capital spending this year to support its AI ambitions.

A look at valuation

Now the question is: Should you follow the billionaires and buy shares of Meta? The stock trades for 27 times forward earnings estimates, making it more expensive than it was a couple of months ago when it fell to less than 20 times expected earnings. But this remains a reasonable valuation for a growth stock, particularly a profitable, well-established player that offers a secure revenue stream and even dividend payments.

The next question is, in the AI boom, should you favor Meta over Nvidia? Investors who have already won on their Nvidia investment over time, such as certain billionaires, may rotate out of the stock and into Meta. Ramping up its AI investment, Meta could be well positioned to deliver gains in the quarters to come. Meta is also slightly cheaper than Nvidia, which today trades for 33 times forward earnings estimates.

So, if you don’t have any Meta shares yet, you may want to get in on this exciting story — but you don’t necessarily have to forget about Nvidia. The best strategy may be to hold shares of both of these AI leaders as the AI boom enters its next chapter.