QualityDipJB
Josh BrownOct 26 · Column
neutralSays Meta is near crucial levels and laid out the levels he's watching to trade it (headline only, article paywalled).
Stocks / Technology · Software & internet services
META
Meta Platforms META
$614.99−1.53% dayFri Oct 30 close
On dip watch: 21% below its 52-week high.
A quality company. No fair value estimate for now: a capital-spending surge is squeezing its free cash flow.
- Fair value est.
- n/a
- Market Value
- forming
- Off 52-wk high
- −21%
- Risk vs market
- Above marketbeta 1.49
5 bullish · 4 bearish See why
Drag across the chart to see any day
Key levels
Every level vs today’s $614.99
- 52-wk lowlowest close, 1 year$525.72−14.5%
- PriceFri Oct 30 close$614.99you are here
- 52-wk highhighest close, 1 year$777.59+26.4%
Fair value estimate
Estimate unreliable for META: free cash flow is squeezed by a capital-spending surge (capex is 78% of operating cash flow over the last 12 months, vs 38% in FY2023), so a DCF on today's free cash flow would understate the business. We’d rather show nothing than a made-up number.
Risk vs market
How risk vs market is measured
One year of daily returns (Oct 30 to Oct 30, 252 sessions). Beta = how much META moved for each 1% move in the S&P 500 (SPY); 1.0 moves with the market. Volatility is the yearly standard deviation of daily returns. Past behavior, not a forecast.
Above market
Swings more than the market, and its own price swings are 3.3× the S&P 500’s.
- Beta vs S&P 500
- 1.49
- Volatility
- 43% vs 13% SPY
- Correlation SPY
- 0.45
- Correlation QQQ
- 0.39
Bull vs bear
Rule-based from the data on this page, strongest first. Not advice.
Top bullish points 5 of 5
ValuationP/E of 21.2× is 17% below its own average of 25.5× at the last 3 fiscal year-ends.
ValuationP/E of 21.2× vs a 33.9× median for the 138 Technology companies we cover.
GrowthSales grew 28% to $242B over the last 12 months vs the 12 months before (SEC filings).
ProfitabilityOperating margin widened to 41.4% in FY2025 from 34.7% in FY2023 (SEC filings).
QualityPasses all four of our quality checks: cash generation, returns on capital, growth and balance sheet.
Top bearish points 4 of 5
Balance sheetDebt rose 220% to $58.7B from FY2023 to FY2025.
Cash returnsFree cash flow fell 36% over the last 12 months vs the 12 months before.
ValuationPrice / free cash flow of 56×: a rich price for the cash it generates today.
GrowthDiluted EPS fell 1.6% in the last fiscal year, below the 18% median for the 118 Technology companies we cover.
Who’s talking about it
Notable investors, executives, analysts and public figures on Meta Platforms in the last 48 hours. Headlines as published, each linked. Their words, not ours.
No notable mentions in the last 48 hours. Checked Nov 1, 9:09 PM ET.
Compare with peers
Closest in size in Software & internet services
CompanyPrice1 yearvs fair valueP/EMkt cap
SPCXSpace Exploration Technologies$134.72−6.4%—n/an/a$1.95TGOOGLAlphabet$279.84−1.4%−1%n/a14.8×$3.49TAPPAppLovin$228.50−10.4%−63%+58%17.5×$85BNBISNebius Group$154.14−10.4%+24%n/an/a$47BBSPBending Spoons S.p.A.$45.52−2.7%—n/an/a$32BZMZoom Communications$95.50−2.2%+13%+10%8.8×$28BAll fundamentals
P/E 21.2 · FCF yield 1.8% · ROE 32%
Valuation
- P/E
- 21.2×3-yr-end avg 25.5× · Technology median 33.9×
- Price / FCF
- 55.7×
- FCF yield
- 1.8%
- EV / EBITDA
- 15.3×
- Price / sales
- 6.61×
- Price / book
- 5.86×
- Market cap
- $1.60Tlisted
- Enterprise value
- $1.60T
Growth
- Revenue, 12 months
- $242B
- Sales growth, 12 months
- +27.5%vs the 12 months before
- Sales growth, 3 yrs
- +19.9%/yrfrom FY2022
- Diluted EPS, 12 months
- $29.31
- EPS growth, last FY
- −1.6%
- Net income, 12 months
- $75.2B
- Net income growth
- +29%12 months vs before
Profitability
- Gross margin
- 81.0%
- Operating margin
- 32.9%
- Net margin
- 31.1%
- FCF margin
- 11.9%
- Return on equity
- 32%
- Return on invested capital
- 28%
Balance sheet
- Cash & short-term inv.
- $82.4B
- Total debt
- $83.7B
- Net cash
- −$1.2B
- Debt / equity
- 0.31×
- Interest coverage
- 29.8×operating income / interest
Cash flow & returns
- Free cash flow, 12 months
- $28.6B
- FCF growth, 12 months
- −36%
- Dividend yield
- 0.34%$5.4B paid
- Payout ratio
- 7%
- Buybacks, 12 months
- $0
- Share count, 1 year
- +0.0%diluted shares vs a year ago
- Stock-based comp
- $26.9B
Trailing 12 months to Sep 30, 2026; balance sheet at Sep 30, 2026. From Meta Platforms’s SEC filings. Sparklines show up to six fiscal years. n/a means we don’t hold that number, with the reason. How each is computed.
Valuation details
Market ValueForming: thesis-changing filing on Oct 29, needs five trading days
forming
Fair value estimaten/a — free cash flow is squeezed by a capital-spending surge (capex is 78% of operating cash flow over the last 12 months, vs 38% in FY2023), so a DCF on today's free cash flow would understate the business
n/a
FCF valuen/a — capital spending is squeezing trailing free cash flow (see above)
n/a
Setup & signals
No setup armed
No setup armed, so there’s no trigger or stop to track yet. We watch it daily for our three reversal signal rules while it sits in a dip.
Momentum & 52-week range
RSI 33 · 5 days −4.3%
$614.99now
52-wk low $525.72high $777.59
Off 52-wk high−20.9%
5 days−4.3%
vs 50-day avg−8.2%
vs 200-day avg−2.7%
RSI (14)33
Market cap$1.60T
The business
FCF $28.6B · Sales +26%
- Free cash flow, 12 months$28.6B
- Free-cash-flow yield1.8%
- Free-cash-flow margin12%
- Gross margin81%
- Operating margin33%
- Return on invested capital18%
- Return on equity32%
- Sales growth (latest quarter vs year-ago quarter)+26%
- Net debt / EBITDA1.0×
Investor buzz
3 from investors
Their view, not ours, and not advice. All buzz
BA
Bill AckmanOct 22 · Interview
bullishMeta has "proven that AI is helping them accelerate their business and this remains an incredibly undervalued stock and that's why we own it." Says don't judge it on day-one trading after earnings.
CW
Cathie Wood (ARK Invest)Oct 22 · Fund trade
bullishARK bought 132,687 shares (Sep 21–Oct 22) and sold 24,299 shares (Oct 8–Oct 12) across ARKF,ARKK,ARKW, per ARK's daily trade disclosures.
Information only, not investment advice. Fair value estimates and talking points are rule-based model output from public data and can be wrong; stop levels are reference points, not orders. How every number is computed.
Get a text when META fires a reversal signal
One text when a published rule fires on META or any of the 333 quality companies we track: the ticker, the price, the stop and a link to the numbers. Nothing else.