This AI Stock Is So Cheap Right Now It Feels Like a Glitch. Here's Why I'm Buying.

Finding a cheap artificial intelligence (AI) stock isn't easy. Many of them are highly valued with unreasonable expectations, but a handful are dirt cheap. I've found one whose price almost feels like a glitch in the system, and it's right under most investors' noses. The stock? Meta Platforms (NASDAQ: META). Meta is incredibly cheap right now, yet it is delivering great results and is only one hit product away from skyrocketing.

I think it's one of the best buys in the market, and with its cheap price tag, it's time to load up on the stock.

Image source: Getty Images.

Meta Platforms hasn't been this cheap in a while

Meta Platforms is the parent company of social media sites like Facebook, Instagram, and Threads. Billions of people around the world use these sites on a daily basis. All of these apps generate revenue from advertisements. Advertising was one of the first areas to be transformed by an AI-first approach, and AI has dramatically boosted ad revenue over the past year. Nearly all of Meta's revenue comes from ads, so when Meta's revenue rises 33% in a quarter (as it did in Q1), it's safe to say these improvements are working out.

Despite Meta's success, the market isn't giving it any credit. Instead, it's zooming in on Meta's soaring capital expenditure, criticizing how much Meta is spending on AI infrastructure. However, Meta is also working toward providing the masses with a superintelligence AI model that could transform its business. Time will tell how that endeavor goes, but if Meta is successful, the stock could rapidly rise because the market is really valuing only its advertising business. Meta is also working on AI glasses. That's another promising segment, but we're still a few years away from seeing it come to fruition.

There is a lot of upside in Meta's stock if one of those products works out, but in the meantime, you can pick it up for a low price.

META Price to CFO Per Share (TTM) data by YCharts

At less than 13 times cash from operations, Meta's stock is looking very attractive from a historical perspective. This is a useful valuation metric for companies in a heavy capital expenditure cycle (like Meta), as it looks only at how much cash the business is producing, not how it's being spent. This is an attractive price for Meta, and I think it represents a major buying opportunity.

Keithen Drury has positions in Meta Platforms. The Motley Fool has positions in and recommends Meta Platforms. The Motley Fool has a disclosure policy.