Meta’s (META) AI Strategy Gains Momentum with Muse Soumya Eswaran Thu, October 8, 2026 at 10:44 AM EDT 3 min read META +0.01% ^GSPC -0.36% Trade META on Coinbase Trading disclosure Trading disclosure The above button links to Coinbase. Yahoo Finance is not a broker-dealer or investment adviser and does not offer securities or cryptocurrencies for sale or facilitate trading. Coinbase pays us for certain activity generated through this link. Prices displayed are informational.
Suncoast Equity Management, an SEC-registered Investment Advisory (RIA), released its Q3 2026 investor letter for "U.S. Equity Large Cap Select Growth Strategy." The letter can be downloaded here. The strategy advanced 4.2% after fees in Q3, compared to 2.3% for the S&P 500, marking a potential shift in market leadership. Despite lagging the S&P 500 over the last four quarters ending June 30, 2026, the gap between portfolio EPS growth and returns is narrowing. Select Growth has risen 14.5% after fees since March, suggesting a promising investment opportunity, especially if severe macro conditions do not arise. Also, check the strategy's top five holdings to see its best picks in 2026.
In its Q3 2026 investor letter, SEM U.S. Equity Large Cap Select Growth Strategy highlighted Meta Platforms, Inc. (NASDAQ:META) as a leading contributor. Meta Platforms, Inc. (NASDAQ:META), the parent company of dominant social media platforms, is a multinational technology company that develops products to connect people. On October 07, 2026, Meta Platforms, Inc. (NASDAQ:META) closed at $721.31 per share with a $1.84 trillion market capitalization. Meta Platforms, Inc. (NASDAQ:META) posted a 9.51% YTD gain, trading within a 52-week range of $520.26 to $779.82.
SEM U.S. Equity Large Cap Select Growth Strategy stated the following regarding Meta Platforms, Inc. (NASDAQ:META) in its Q3 2026 investor letter:
"For much of the past year, investors have rewarded companies viewed as direct beneficiaries of AI infrastructure spending while penalizing others for two very different concerns: that AI could disrupt their business models, or that enormous AI capital expenditures may not generate adequate returns. Separately, investors have questioned whether Meta Platforms, Inc.'s (NASDAQ:META) enormous AI capital spending will earn sufficient returns. That is a legitimate issue, but new AI-enabled products and monetization opportunities demonstrate how quickly sentiment and potential economics can change. Muse has been the most downloaded app on Apple and Android devices since its introduction in September and early user reviews are favorable. AI has already improved Meta's advertising effectiveness and if it also creates new revenue streams, today's heavy spending can increasingly look like a savvy investment. It is too early to tell specifically how much Meta monetizes Muse, but the stock's extremely rapid snap back during the quarter is an example of what can happen when a company's stock price and fundamentals get overly disconnected. Muse helped remind market participants that Meta remains a powerful global advertising platform growing earnings at an expected 35% in 2026 yet trading at a Price to Earnings ratio below the market."
Meta Platforms, Inc. (NASDAQ:META) holds 5th position on our list of 40 Most Popular Stocks Among Hedge Funds Heading Into 2026. According to our database, 254 hedge fund portfolios held Meta Platforms, Inc. (NASDAQ:META) at the end of the second quarter, compared to 262 in the previous quarter. While we acknowledge the potential of Meta Platforms, Inc. (NASDAQ:META) as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.
In another article, on Meta Platforms, Inc. (NASDAQ:META), we highlighted Dan Niles' suggestion that the company could monetize its massive AI spending by launching a public cloud business to compete with Amazon, Microsoft, and Google. In addition, please check out our hedge fund investor letters Q3 2026 page for more investor letters from hedge funds and other leading investors.
This article is originally published at Insider Monkey.
