Should You Buy Meta Platforms Stock Before July 30?

Key Points

• More than 3.4 billion people use Meta Platforms' social networks, such as Facebook, Instagram, and WhatsApp every day.

• Meta is using artificial intelligence (AI) to keep those users engaged, which could be a major tailwind for its revenue over time.

• Meta is scheduled to release its financial results for the second quarter of 2025 on July 30, and all signs point to another strong report.

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Meta Platforms (NASDAQ: META) is the parent company of popular social networks like Facebook, Instagram, and WhatsApp. It has also become a leader in the artificial intelligence (AI) race thanks to its Llama family of large language models (LLMs), which are among the best in the industry.

Meta's operating performance has been incredibly strong over the past year, thanks partly to its investments in AI, so its stock is unsurprisingly trading near a record high. The company is scheduled to release its financial results for the second quarter of 2025 (ended June 30) on July 30, and management's guidance points to another strong report.

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Should you buy Meta stock before the end of the month?

Image source: Getty Images.

AI is transforming Meta's business

Meta has become a top destination for advertisers who want to reach the largest possible audience, because over 3.4 billion people use its social media platforms every day. The more users Meta attracts, the more money it makes from selling advertising slots to businesses. But the company can also generate more ad dollars by keeping existing users online for longer periods of time, which is where AI comes in.

Meta developed an AI algorithm that learns what content each user likes to see, and then shows them more of it to keep them engaged. During a conference call with investors for the first quarter of 2025 (ended March 31), CEO Mark Zuckerberg said that AI-driven content recommendations led to a 6% increase in the amount of time users spent on Instagram over the previous six months, and a 7% increase for Facebook, so this strategy is working extremely well.

Developing new features is another way to keep users coming back. In 2023, Meta launched its chatbot, Meta AI, which is accessible through all of its existing social media apps. It's powered by the company's latest Llama LLMs, making it highly proficient at answering questions on a variety of topics, and even generating images. At the end of Q1 2025, Meta AI had almost 1 billion monthly active users, which was an incredible achievement after less than two years on the market.

In June, Meta also acquired a 49% stake in Scale AI for $14.3 billion to bolster its AI ambitions. Scale AI is a specialist at turning raw data into training data, which accelerates the pace at which AI models get "smarter," and it has an impressive list of customers that includes Microsoft and ChatGPT creator OpenAI. By backing Scale AI, Meta will have an opportunity to tap into top-tier talent and rapidly improve its data infrastructure. Scale AI's founder, Alexandr Wang, already agreed to join the social media giant as part of the deal.

A strong second quarter is in the cards

Meta generated $42.3 billion in total revenue during Q1 2025, which was a 16% increase from the year-ago period. The company also delivered $6.43 in earnings per share (EPS), which was up by a whopping 37%.

According to management's guidance, Meta's revenue likely came in somewhere between $42.5 billion and $45.5 billion during the second quarter. The high end of that range would represent steady year-over-year growth of over 16%.

The company didn't offer an earnings forecast, but according to Wall Street's consensus estimate (provided by Yahoo! Finance), its EPS could come in at around $5.84. That would be a more modest increase of around 13%, likely because of the company's substantial investments in AI.

On that note, investors should look out for an update to Meta's annual capital expenditures (capex) forecast on July 30. In Q1, the company told investors that it planned to spend between $64 billion and $72 billion on AI data center infrastructure and chips this year, which was up from its previous estimate of between $60 billion and $65 billion.

This spending may dent Meta's earnings power in the short term, but the hope is that it will lead to accelerated growth at the top and bottom line in the future as the enormous AI investments pay off. If Meta issues another increase to its capex forecast on July 30, it could be a sign of management's confidence in AI's ability to continue transforming its business for the better.

Should you buy Meta stock before July 30?

Meta stock might be cheap right now, even though it's trading near an all-time high. Its price-to-earnings (P/E) ratio is 28.3 as of this writing (July 10), so it's notably cheaper than the Nasdaq-100 index, which trades at a P/E ratio of 32.3.

Moreover, Meta is the second-cheapest stock in the "Magnificent Seven," which is a group of technology leaders that have turned their attention to the AI race.

PE Ratio data by YCharts.

Meta's success is years in the making, so I don't think one quarterly report will change the company's trajectory. Its stock could be a great buy ahead of July 30 because of its attractive valuation and the company's presence in the AI space, regardless of its upcoming second-quarter report.

As long as investors buy Meta stock with a plan to hold it for the long term -- preferably for five years or more -- buying it any time this month will likely yield solid results over time.

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Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Randi Zuckerberg, a former director of market development and spokeswoman for Facebook and sister to Meta Platforms CEO Mark Zuckerberg, is a member of The Motley Fool's board of directors. Anthony Di Pizio has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia, and Tesla. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.