Strong Top-Line Growth and AI Innovation Lifted Meta Platforms (META) Higher Soumya Eswaran Fri, October 16, 2026 at 12:33 PM EDT 3 min read META -2.67% ^NDX -1.64% ^GSPC -0.67% TOL +0.20% RMS.PA -0.07% Explore stocks 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.
Wedgewood Partners, an investment management company, released its third-quarter 2026 investor letter. The letter can be downloaded here. Wedgewood Composite delivered a net return of 2.5% in the quarter, compared to 2.3% for the Standard & Poor's 500 Index, 0.9% for the Russell 1000 Growth Index, and 2.6% for the Russell 1000 Value Index. Surging Treasury yields and macro headwinds have heavily pressured rate-sensitive stocks and market breadth, driving equal-weighted S&P 500 underperformance. However, AI resilience and mega-cap tech pushed the NASDAQ 100 to record highs. While rising inflation, energy price spikes, and higher interest rates continue to pressure broader equities, the firm is actively deploying capital into compelling new positions, recently adding Toll Brothers, Hermès, and TJX Companies. Also, check the strategy's top five holdings to see its best picks in 2026.
In its Q3 2026 investor letter, Wedgewood Partners highlighted Meta Platforms, Inc. (NASDAQ:META) as a standout performer this quarter. 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 15, 2026, Meta Platforms, Inc. (NASDAQ:META) closed at $736.72 per share with a $1.88 trillion market capitalization. Meta Platforms, Inc. (NASDAQ:META) posted an 11.61% YTD gain, trading within a 52-week range of $520.26 to $779.82.
Wedgewood Partners stated the following regarding Meta Platforms, Inc. (NASDAQ:META) in its Q3 2026 investor letter:
Meta Platforms, Inc. (NASDAQ:META) was another standout performer in the portfolio this quarter. Revenues grew 28%, and the Company launched a slew of AI products and updates that the market viewed positively. Meta has a long history of launching massive, objectively successful products. Yet the market often ignores them or even penalizes them. While Meta's Metaverse investments are a clear reason to be skeptical that management will bat 1.000, they are hardly a reason to discount every clear and obvious home run, or even grand slam. More recently, the Company's Threads app, launched just 3 years ago, has over 500 million monthly active users. This quarter, Meta also rolled out its Muse Agent, which users can set on autopilot to handle mundane but productive tasks like lowering phone bills or renewing license plate tags. The Muse Agent works in tandem with a private virtual machine (we estimate its value at $500 to $1,000) that every user gets for free and that maintains the user's privacy and security throughout the process.
While it is still early days, the Company's advancements on the LLM frontier, along with its long history of working with encryption, especially through WhatsApp, have made the rollout and execution of Muse Agent among the best since OpenAI launched ChatGPT. Over the next several years, we think Meta has plenty more AI products and investments that will generate returns on par with those of past years."
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, we discussed Meta Platforms, Inc. (NASDAQ:META) and shared Oakmark Fund's addition of the stock in its portfolio during the quarter. 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.
