2 Bargain Artificial Intelligence (AI) Stocks to Buy Now Down Around 25% From Their All-Time Highs

https://www.theglobeandmail.com/investing/markets/markets-news/motley/2411739/2-bargain-artificial-intelligence-ai-stocks-to-buy-now-down-around-25-from-their-all-time-highs/

Publish Date: 2026-06-10 21:00:00

Source Domain: www.theglobeandmail.com

Here is a summary of the article with 6 key points:

Meta Platforms’ Mixed Performance: Meta Platforms has seen a significant drop of over 25% from its all-time high despite strong advertising revenue. While its core ad business is thriving, leading to a 33% year-over-year revenue increase in Q1, investors are concerned about its massive AI investments which have yet to show substantial returns.
AI Spending Concerns: Meta has expanded its capital expenditure related to AI by $10 billion, significantly increasing its total guidance to around $135 billion. The market remains cautious given the lack of clear returns on these AI investments thus far.
Strong Core Business: Despite its high AI spending and current market concerns, Meta still operates a robust core business driven by popular platforms like Facebook, Instagram, and WhatsApp, which helps justify its lower current stock valuation.
Microsoft’s Profitable AI Growth: In contrast to Meta, Microsoft’s AI business has grown rapidly, with a 123% year-over-year increase in its last quarter. Its Azure unit and overall cloud computing growth further bolster its performance, but its stock still trades at a discount compared to the broader market.
Stock Valuation Discrepancies: Both Meta and Microsoft have seen significant stock declines from their all-time highs (around 25%), yet their current prices are lower than the S&P 500 PE ratio, indicating potential undervalued stocks based on current market metrics.
Investor Consideration: While both stocks appear undervalued based on market multiples, the Motley Fool Stock Advisor does not currently recommend Meta Platforms. They published a list of 10 top stocks for investors, emphasizing potentially high-performing stocks such as Netflix and Nvidia from previous recommendations.