"The S&P 500 has risen about 10% this year and is hovering near its all-time highs. That rally was largely driven by the tech sector's robust growth rates, big buybacks, earnings beats across the market, easing trade tensions, and hopes for deeper interest rate cuts. But with a price-to-earnings ratio of 30, the S&P 500 also looks historically expensive. However, some of the S&P 500's top stocks are outperforming the benchmark index by a wide margin but still trading at reasonable valuations."
"One of those stocks is Meta Platforms , the parent company of Facebook, Instagram, Messenger, and WhatsApp. Meta's stock has rallied nearly 30% year to date but trades at just 27 times its trailing earnings. Let's see why it crushed the market -- and why it might soar even higher through the end of 2025. The world's biggest social media company keeps growing Meta is the world's largest social media company. It served 3.48 billion daily active people (DAP) across its entire family of apps in the second quarter of 2025. That's nearly two-thirds of the world's adult population."
"That growth was driven by its new artificial intelligence ( AI)-powered algorithms and ad targeting systems, which attracted more users and monetized them more effectively. Those upgrades countered Apple's privacy changes on iOS, which throttled its ad sales three years ago. Meta's short-video platform, Reels, kept pace with ByteDance's TikTok and locked more users into Facebook and Instagram. It's also been rolling out more ads on Threads, which is gradually gaining momentum against X in the microblogging market."
Meta Platforms is the largest social media company, serving 3.48 billion daily active people across its apps in Q2 2025, nearly two-thirds of the world's adult population. The stock rallied nearly 30% year-to-date while trading at about 27 times trailing earnings. User growth, higher ad impressions, and rising ad prices fueled performance. Growth was driven by new artificial intelligence-powered algorithms and ad targeting that improved monetization and offset prior iOS privacy headwinds. Short-video Reels and increased ads on Threads helped retain users and expand ad reach, reinforcing Meta's strong position in digital advertising.
Read at The Motley Fool
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