<p><strong>Meta Platforms </strong>(NASDAQ:META) stock is underperforming the market this year. It ended the week at $577, down by 27% from its highest point last year, with its valuation falling from $2 trillion to $1.47 trillion.</p>



<h2>Meta Platforms Has Become a Bargain</h2>



<p>The ongoing Meta stock retreat has made it a bargain. Its trailing price-to-earnings ratio has dropped to 20, its lowest level since February 27 2023. It has been in a slow downtrend after peaking at 32 in October last year.</p>



<p>The company’s forward price-to-earnings ratio has slipped to 17, lower than the technology sector average of 33. It is also lower than its five-year average of 22. Similarly, the forward price-to-earnings-to-growth ratio has slipped to 86 cents, also lower than the sector median of 1.2.</p>



<p>Meta Platforms stock has retreated because of the ongoing investments in artificial intelligence and fears that it will dilute its shareholders. It plans to spend $135 billion this year, up from the previous guidance of $115 billion, citing the rising chip prices. Its spent $72 billion in capex last year. </p>



<p>The company is planning to raise cash to fund this capital investment. According to the FT, it is considering raising about $85 billion, following in the footsteps of <strong>Alphabet </strong>(NASDAQ:GOOG), which raised $80 billion through a combination of debt and equity.</p>



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<p>Most importantly, there are concerns about the return on investment in its AI investments. Meta AI, its main artificial intelligence platform, has a smaller market share compared to ChatGPT, Claude, and Google Gemini. A recent report suggested that Grok, Perplexity, DeepSeek, and Meta AI commanded less than 5% of the share.</p>



<h2>Analysts are Bullish on Meta Platforms Stock</h2>



<p>On the positive side, analysts are still bullish on the Meta stock price. According to Benzinga, the average estimate among analysts is $834, up by 45% from the current level. RBC Capital maintained their target at $810, while Rosenblatt maintained at $1,015. Wedbush boosted their rating from neutral to outperform, while Mizuho hiked to $850. </p>



<p>One of the main reasons for this is that it is still growing because of its advertising business. The most recent Meta earnings<strong> </strong>showed that its revenue jumped by 33% to $56.3 billion. Its net income soared by 61% to $26 billion.</p>



<p>The average estimate among analysts is that its revenue jumped by 25% this year to $237 billion. It will then make over $282 billion next year, and this gradual growth will continue over time. </p>



<h2>Technicals Pose a Big Risk to Meta Platforms Shares</h2>



<figure class="wp-block-image size-large"><img width="1024" height="567" src="https://imageproxy.pbkrs.com/https://editorial-assets.benzinga.com/wp-content/uploads/2026/06/20141958/Meta-Platforms-stock-1024x567.png?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" alt="meta platforms stock" original-src="https://imageproxy.pbkrs.com/https://editorial-assets.benzinga.com/wp-content/uploads/2026/06/20141958/Meta-Platforms-stock-1024x567.png"/><figcaption><em>META stock chart | Source: TradingView</em></figcaption></figure>



<p>A key risk facing Meta Platforms is that its technicals suggest it has more downside over time. The weekly chart shows that it has slumped below the 23.6% Fibonacci Retracement and the 50-week moving average. </p>



<p>It has also formed a multi-month head-and-shoulders pattern, a common bearish reversal sign. Also, the two lines of the MACD have continued falling. Therefore, technicals suggest that the stock may continue falling, potentially to $500.</p>



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<p><em>Image: Shutterstock</em></p>

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<p>Meta stock has retreated 27% from its peak, with valuation dropping to $1.47 trillion and P/E ratios hitting multi-year lows due to heavy AI capex spending and market fears. Despite technical bearish signals suggesting further downside, analysts remain bullish with average price targets around $834, citing strong advertising revenue growth of 33% and net income surge of 61%. Meta is considering raising $85 billion to fund investments.</p>

- Meta Platforms (NASDAQ:META) stock is underperforming, currently at $577, down 27% from its 2022 high, with a valuation drop from $2 trillion to $1.47 trillion.  
- Despite the downturn, analysts are bullish, projecting an average price of $834, buoyed by a strong 33% revenue increase in earnings and continued growth in the advertising sector.  
- However, technical indicators suggest further declines may occur, with potential drops to around $500 due to bearish patterns in the stock chart.

Meta Stock Hasn’t Been This Cheap in Years. Is It a Buy?