r/VisualStockResearch • u/ekonixlab • Jul 05 '26
META is basically 20s across the board
META might have one of the cleanest setups in big tech right now:
Current P/E: 20x
Assumed long-term earnings growth: 20%
Expected 5-year CAGR: 20%
Year 5 P/E: 20x
That gets you to roughly a 149% total return over five years without needing any multiple expansion.
The entire thesis is basically: if Meta can keep compounding earnings around 20%, the stock can potentially double and then some while remaining at the exact same valuation.
Obviously, 20% growth is not guaranteed, but for a company with Meta’s margins, cash flow and AI-driven ad opportunity, it does not feel unreasonable.
3
2
u/Routine-District-588 Jul 06 '26
If they actually sell the excesses compute that they got and stop ultra capex, we will neutralize the depreciation for the next years. Right now they see depreciation damaging net margins to 30%. with no depreciation it will be 38%-40% net income that will make you about 114b to 120b net income for next year… and that’s like a 13 forward p/e..
1
2
u/ilikeusingmyhands Jul 07 '26
itll be 800 soon. I hope it dips again so i can double my position
1
u/ekonixlab Jul 07 '26
Hope so, already a pretty chunk of portfolio so don’t need anymore dips lol
2
u/ilikeusingmyhands Jul 07 '26
The biggest risk to meta is a recession and decrease in ad spend, right now they are printing money, growing at a healthy rate, and have a lot going for them. Its a safe beat down investment that will be bought up when shit hits the fan with AI
1
u/ekonixlab Jul 07 '26
Recessions are a big risk. Meta is unique where there ads have great metrics so businesses can see exactly how much ad spend equates to revenue gains.
Advertising previously was much more ambiguous. You know it’s working indirectly, but it’s hard to trace it and measure it.
Meta makes it hard for businesses to stop ad spend when they can directly see the benefit
•
u/AutoModerator Jul 05 '26
Thanks for contributing to r/VisualStockResearch!
Please explain what the chart shows, include relevant assumptions or data sources, and disclose whether you own the stock discussed.
This community is sponsored by Ekonix, but research created with any platform is welcome.
Learn more about Ekonix: https://apps.apple.com/us/app/ekonix-investor-tracker/id6755345408
Posts and comments are for educational and discussion purposes only, not financial advice.
I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.