Meta Stock Slides as Stephen Mandel Holds Firm, Signaling Long-Term Confidence

When a stock dips, most people get afraid, which results in a sell off of their shares. But when the major stocks fall that are owned by high-profile hedge fund billionaires, they cause the market to notice that investors are getting quite interested in them.

This is just what is happening with Meta Platforms. The main position of Stephen Mandel’s Lone Pine Capital is now at a price very much lower than its highest ever points.

What Stephen Mandel’s Portfolio Tells Investors

Regulatory filings grant investors a view of the portfolios of the top hedge fund managers. Any fund whose market value is above $100 million has to submit a Form 13F to the Securities and Exchange Commission at the end of each quarter containing a list of its invested companies.

The data is such that it arrives after sometime, but it still indicates how the smartest money in the market is currently positioned, which is of invaluable assistance.

On 30^th September 2025, Meta Platforms represented 7.1% of the total value of Stephen Mandel’s portfolio, which was his most important and single largest holding. After that date, Meta’s shares have dropped by approximately 10% and are now around 15% less than the peak.

Also, the decline has raised concerns among a section of the investors. The others, particularly the ones keeping an eye on Mandel’s long-term track record, are asking themselves, could this be a temporary setback before another peak or not?

Meta’s Strong Business & Alarming Guidance

Meta Platforms is right in the middle of the global digital advertising ecosystem, owning Facebook, Instagram, WhatsApp, and Threads. Its advertising still accounts for almost all of the firm’s revenue, turning the company very economic cycle sensitive.

Strong growth means flourishing advertising spending, while increased uncertainty leads to marketing budgets getting reduction being the primary measure.

Currently, the main business of Meta is anything but fragile. The firm had a remarkable third quarter with a revenue increase of 26% as compared to the previous year.

Such growth at Meta’s level indicates not only strength of the platform, but also the high demand for advertisements. However, in spite of these results, the stock went down, not because of what Meta did, but due to what it plans to do next.  

A Heavy Price Tag

Mark Zuckerberg has always been open to huge future bets. First came mobile, then the metaverse, and now generative AI. Meta’s aspirations are not limited to chatbots and social media, but they also cover the real-world applications with the likes of AI-powered smart glasses that are considered for total integration into one’s everyday life.

It is not cheap to build that future. Meta is pouring huge amounts of money into AI and related infrastructures, which are a combination of self-built and rented resources for computing power. Already capital expenditures have increased a lot, and the management has warned that the growth in spending will be considerably bigger in 2026 as compared to 2025.

The given estimate suggests the possibility of the yearly capital spending going over the $100 billion mark, which is a very unsettling figure for investors.

There are whispers that suggest Meta might cut its expenses in the cash Reality Labs division, but in the overall scheme of things very few think that the company will significantly slow down the pace of its investments.

In fact, capital will probably flow directly into AI compute, which will propel Meta’s ambitions in the long run, but will also negatively affect sentiment in the short run.

Market Might Not Be Seeing the Bigger Picture

The market’s reaction is indicative of short-term uneasiness with the situation, and not any sort of lack of confidence for the long-term. Investors usually react negatively towards rising capital expenditures, specifically when they make the short term profit harder to reach.

But history shows that it is hard to come across platforms that have been built without high costs. Meta may already have some lasting AI edge, and their current expenses might be considered to be a bargain in retrospect.

The horizon of this long-term possibility may be the very reason that Stephen Mandel has retained Meta as his largest holding. With the new filing deadlines in March as a reference, we will not know if he increased his holdings after the sell-off, but just his current belief shows a very strong signal as to the value of Meta.

Meta’s Valuation Seems Attractive

One of the strongest points for Meta is probably its valuation. The stock dropped recently and is now trading at around 21.7 times its forward earnings, which is a little less than the S&P 500, which is trading at about 22.3 times. That’s a big change for a previously quite highly-priced stock.

With such a big gap between them and difficult to justify discounts, Meta’s strong revenue growth, powerful platforms, and AI advertising and engagement is a big step ahead. Although high capital spending might hurt margins temporarily, the business is still very profitable and strong.

Bottom Line

If investors are prepared to overlook the quarterly spending news, then Meta’s current position would be increasingly attractive. The stock is less expensive, the core business is flourishing, and the company is establishing itself as the leading edge of AI technology. Such a situation is exactly what long-term investors and even billionaire hedge fund managers usually like.

It is still uncertain whether or not Stephen Mandel will purchase more shares. But even in the absence of that confirmation, the blend of valuation, growth, and strategic ambition that Meta possesses is enough to attract attention. As markets start looking into 2026, this dip might be interpreted not so much as a warning, but as an opportunity that is already well visible.