As we explore the retail sentiment on major AI stocks, one name keeps popping up in the discussions on Reddit: Meta Platforms (NASDAQ:META). Despite a 4% decline in value this year, many long-term investors believe that now is the perfect time to buy into this AI giant.

What Meta Does and Why It’s Down

Meta is the parent company of Facebook, Instagram, and WhatsApp, with a significant portion of its revenue coming from advertising on these platforms. However, the company’s value has taken a hit this year due to a single factor: Mark Zuckerberg’s massive investment in AI data centers. Investors are concerned that this expenditure may not yield the desired returns, leading to a decline in the stock’s value.

Why Bulls Are Buying

Despite the concerns, many bulls believe that the market is punishing Meta for its capex, rather than the actual business. The company’s revenue has grown by 33% year-over-year in the last quarter, with one Redditor commenting, ‘I’m at $300 cost basis and am never selling META. I’ll just buy the dip and keep buying.’ The bulls argue that Meta is turning a cost center into a second revenue stream by leasing excess GPU capacity to third parties and exploring new AI infrastructure deals. The company has already struck a $21 billion expanded AI infrastructure deal with CoreWeave and is in talks for a compute deal worth up to $10 billion with Anthropic over two years.

The Neocloud Pivot

Bulls see this pivot as a significant shift in Meta’s strategy, moving from being a mere spender to becoming a ‘neocloud’ that generates revenue. This could be a game-changer for the company, especially considering that the market has historically been skeptical of Zuckerberg’s capital allocation after the Metaverse bet. However, this time around, the market seems to be responding positively, with price targets ranging from $1,011 to $1,000.

Why Bears Aren’t Buying It

The bear case, on the other hand, centers around the competitive threat posed by China’s Moonshot AI. The company has recently released Kimi K3, a new 2.8-trillion-parameter AI model that outperforms Meta’s own Muse Spark in benchmark testing. Bears argue that Kimi K3’s release will accelerate the commoditization of mid-tier AI models, undercutting Meta’s pricing power in the process.

The Bear Case in Full

According to the bears, if Kimi K3’s open weights spread fast and squeeze pricing across the mid-tier AI market, Meta’s external AI ambitions could shrink to a commodity cost center, leaving the ad business alone to carry a capex bill that’s already approaching $145 billion. The stock’s fate likely comes down to whether Meta’s neocloud pivot generates real revenue before the pricing pressure bites.

Madison Large Cap Fund has also weighed in on Meta Platforms, stating in its Q1 2026 investor letter, ‘We believe revenue growth will remain strong as its user count grows and monetization of its apps improves. Meta is investing heavily in AI and seeing real benefits in the personalization and efficacy of ads in its social network.’

A Promising Future?

While the risk and potential of META as an investment are undeniable, the conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns within a shorter time frame. If you’re looking for an AI stock that’s more promising than META, with 10,000% upside potential, check out our report on the cheapest AI stock.

Meta Platforms (NASDAQ:META) has been a clear favorite among long-term retail investors, with many believing that now is the perfect time to buy. However, the bears are not convinced, citing the competitive threat from China’s Moonshot AI and the company’s history of burning through billions in cumulative losses. The stock’s fate likely comes down to whether Meta’s neocloud pivot generates real revenue before the pricing pressure bites.

As we continue to monitor the developments in the AI space, one thing is clear: Meta Platforms (NASDAQ:META) is a stock that’s generating a lot of buzz. Whether you’re a bull or a bear, it’s essential to stay informed about the company’s latest moves and the implications for its investors.

Meta Platforms (NASDAQ:META) has been a clear favorite among long-term retail investors, with many believing that now is the perfect time to buy. However, the bears are not convinced, citing the competitive threat from China’s Moonshot AI and the company’s history of burning through billions in cumulative losses. The stock’s fate likely comes down to whether Meta’s neocloud pivot generates real revenue before the pricing pressure bites.

Investors are concerned about increasing capital expenditures, but the Madison Large Cap Fund believes that much of it will garner strong returns, and management will remain prudent in managing spending over the long term. The fund initiated positions in Meta Platforms, citing the company’s strong revenue growth and investment in AI.