Meta Platforms Stock Rose 25% in September. Is It Still a Buy in October?
2026-10-03 05:27
•Keithen Drury •The Motley Fool
••••••• • Axe Cap view
Meta's AI Boost: Still Worth Watching After September's Surge?
Meta Platforms jumped 25% in September on its new AI product, but October gains may slow as the market waits on earnings.
Meta’s 25% jump in September came largely on the back of Meta Muse, an AI assistant aimed at everyday users with a freemium pricing model. This product helps justify the huge AI spend that's had investors jittery before. Trading at about 23 times forward earnings, it’s no longer a deep value bargain but not overpriced either. For South African investors, this matters because tech-heavy indices like Naspers and Prosus hold significant Meta exposure. These counters could see some indirect benefit if Muse gains traction globally. However, October likely won’t see another 25% leap – the market tends to price in hype early. If the Q3 earnings show weaker-than-expected user engagement or monetization challenges, the optimism may fade quickly. So the trade-offs here are clear: long-term AI adoption is promising, but short-term performance is likely to moderate. this is just our opinion and not financial advice
For JSE investors, hold or trim some Naspers and Prosus as Meta’s AI story unfolds. Be ready to buy on any post-earnings dip if Muse shows sustained user uptake.
- Naspers
- Prosus
- USD/ZAR
- Weak user adoption of Meta Muse
- Global tech valuation reset impacting Prosus/Naspers
6/10
Meta Platforms surged 25% in September following the launch of Meta Muse, an AI agent designed for everyday consumer use with a freemium subscription model. The product addresses previous investor concerns about Meta's massive AI infrastructure spending without clear monetization. While the stock has moved from undervalued to normal valuation ranges, analysts expect modest October performance pending Q3 earnings results, though long-term prospects appear brighter if Muse gains widespread adoption.
Our take is based on reporting first published by The Motley Fool.