Meta Platforms’ stock dipped slightly after reports of a new AI strategy called “Avocado,” involving closed, monetizable models with tech from Chinese companies like Alibaba. This shift from decentralized models like Llama could impact Meta’s ability to commercialize AI. Investors may be uncertain about Meta’s future direction.

Meta Platforms, with a $1.6 trillion market cap, is the largest social media company globally, boasting 3.54 billion daily active users across Facebook, Instagram, WhatsApp, and Messenger. Despite a 10% stock increase in 2025, Meta lags behind other top-performing stocks this year, like Amazon, in the Magnificent Seven cohort.

META stock trades at a P/E ratio of 28.5, above its historical average. The company started paying dividends in 2024, offering a 0.3% yield of $0.525 per share quarterly. Meta consistently surpasses earnings estimates, with Q3 revenue up 26% year-over-year and per-share earnings beating expectations.

Meta expects strong revenue growth in 2026 from ad improvements and AI initiatives. Q4 revenue guidance is $56-59 billion, with full-year capital expenditures of $70-72 billion. The company reported a one-time tax charge but anticipates reduced federal cash tax payments due to new legislation.

Analysts overwhelmingly rate META stock as a “Strong Buy,” with a mean price target of $842, signaling potential growth ahead. Despite underperforming this year, analysts are optimistic about Meta’s future prospects.

Read more at Yahoo Finance: Meta Platforms Is Considering a Pivot to ‘Closed’ AI Models. What Does That Mean, and Why Don’t META Stock Investors Like It?