In recent months, shares of Facebook parent Meta (META) have been hammered as investors grew increasingly concerned about the company’s artificial intelligence (AI) expenditures.
Over the past month, the stock is down 8.63%. This contributes to a six-month slide of about 14%. The previously high flying stock is now among the least magnificent of the magnificent seven. Obviously, the stock has been weak of late. However, that doesn’t imply tactical traders should ignore the Direxion Daily META Bull 2X Shares (METU ).
In fact, METU, which is designed to deliver 200% of the daily returns of Meta, could be a leveraged ETF to monitor. Some market observers believe Meta’s core business remains solid.
Meta Can Get Its Groove Back
Among single-stock ETFs addressing Meta, the bearish Direxion Daily META Bear 1X Shares (METD ) has obviously been the place to be in recent months as some investors are recalling Meta’s history of profligate spending on new technologies that didn’t pan out.
“Investors are just worried about the capital inferno, and we’ve seen this before” says Morningstar analyst Malik Ahmed Khan of the company’s sky-high capital expenditures. “With Reality Labs, they ended up burning billions.”
Either METD or METU could be worth examining over the near-term. Meta is scheduled to deliver fourth-quarter and full-year 2025 results before the end of January. That update could include commentary on financial guidance for this year as well as AI spending plans. Either of these could provide trading opportunities with the Direxion ETFs. For traders considering the bullish METU, it’s worth noting Meta’s advertising business is likely to continue delivering the goods.
“Meta’s advertising business has continued to post strong growth, even as the company ramps up AI-related spending. But investor unease has shifted toward what 2026 could look like, particularly as Meta prepares forward guidance alongside its fourth-quarter earnings,” according to Morningstar.
When it comes to AI spending, investors are likely to demand some form of payoff from Meta because unlike some rivals, it doesn’t have a standalone entity through which it can monetize those expenditures. The good news is the company has levers to pull to potentially get shareholders excited about its AI plans.
“Meta is trying to build the best new assistant in the world … investors don’t really care about that. But dollars that are spent augmenting their ad tech via AI, investors would very much get behind that,” adds Khan.
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