Investors are warming to Meta’s aggressive AI strategy as enthusiasm around Muse helps shares overcome spending concerns and years of costly technology bets.
Meta Platforms (META) is once again proving its ability to rebound from investor skepticism, with shares on pace for their strongest monthly performance in more than a decade.
Despite falling about 3% on Friday, Meta stock has gained more than 30% since the beginning of September and roughly 13% over the past week. The latest rally has been fueled by growing enthusiasm surrounding Muse, Meta’s new artificial intelligence agent.
KeyBanc Managing Director Justin Patterson said Meta is “having its moment,” maintaining an Outperform rating while raising his price target to $900 following the Muse announcement. Based on KeyBanc estimates, Meta is now trading at roughly 21 to 23 times forward earnings, bringing its valuation back toward historical levels.
The rally represents a dramatic shift in sentiment after investors spent much of 2026 questioning Meta’s rapidly expanding AI expenditures and declining free cash flow. Shares suffered sharp selloffs earlier this year as management increased its AI spending plans and delivered quarterly results that disappointed Wall Street.
Those concerns followed years of criticism surrounding Reality Labs and Meta’s metaverse ambitions, which have generated more than $73 billion in losses over five years.
Still, Meta has repeatedly recovered from periods of intense investor concern. Following its historic 26% plunge in February 2022, CEO Mark Zuckerberg eventually responded with aggressive cost reductions and strategic changes.
Now, enthusiasm around Muse could mark another turning point as investors begin looking for tangible returns from Meta’s enormous AI investments.
