BetterInvesting Names Meta for Valuation Study; Alphabet Highlighted as Undervalued

This analysis is based on the BetterInvesting™ Magazine press release [1] published on April 22, 2025, which announced Meta Platforms (NASDAQ: META) as the “Stock to Study” for the June/July 2025 issue, specifically addressing investor questions about whether the company is overvalued. The same release highlighted Alphabet (NASDAQ: GOOG) for review from an undervalued perspective [1].

The market reaction on the publication date was modestly positive for both stocks. META closed at $500.28 on April 22, representing a 3.22% increase from the previous close of $484.66, with trading volume rising to 17.399 million shares from 16.166 million shares the prior day [0]. GOOG showed similar strength, closing at $151.47 (up 2.58% from $147.67) with volume increasing to 26.972 million shares from 26.049 million shares [0].

Both companies trade at similar valuation multiples, with META and GOOG both carrying P/E ratios in the high-20s range (approximately 27-28x) [0]. However, their market capitalizations differ significantly, with META at $1.63 trillion compared to GOOG’s $3.40 trillion [0]. The press release itself does not contain new fundamental data but rather serves as an editorial selection that may increase retail investor attention when the full analysis is published in June/July 2025 [1].

The BetterInvesting designation carries more educational than institutional weight. While the press release generated modest buying interest on publication day, as evidenced by the price gains and increased volumes [0], such selections typically influence retail investors and investment clubs rather than institutional allocations [1].

Meta’s valuation concerns are legitimate given its high-20s P/E multiple, which implies continued strong revenue and margin expansion assumptions [0]. The company remains heavily dependent on advertising revenue, creating concentration risk if ad demand weakens [0]. Meanwhile, Alphabet’s characterization as potentially undervalued suggests it may offer better risk-adjusted returns at current levels, though both companies face similar regulatory and market challenges.

The timing of this analysis is noteworthy, coming as both companies face significant AI-related capital expenditures and ongoing regulatory scrutiny in major markets [0]. The full BetterInvesting study, when published in June/July 2025, will likely provide deeper insights into their relative valuation metrics and growth assumptions.

• Valuation Sensitivity
  : Meta’s current P/E of 27-28x reflects forward growth assumptions that could prove optimistic if ad revenue growth or AI monetization disappoints [0]
• Regulatory Exposure
  : Ongoing antitrust and regulatory actions in the U.S. and EU could impact ad targeting capabilities and revenue models for both companies
• Capital Allocation Risk
  : Large investments in AI infrastructure and, for Meta, Reality Labs could compress near-term free cash flow if returns are slower than expected [0]
• Advertising Concentration
  : Both companies remain heavily dependent on advertising revenue, making them vulnerable to cyclical ad market weakness [0]

• The BetterInvesting study may drive increased retail investor attention, potentially creating short-term trading opportunities around the June/July publication [1]
• Alphabet’s undervalued characterization suggests potential relative value compared to Meta at current levels
• Both companies’ AI initiatives could drive future revenue growth if successfully monetized

The April 22, 2025 BetterInvesting press release represents an editorial signal rather than new corporate disclosure [1]. Meta closed at $500.28 (+3.22%) with increased volume of 17.399M shares, while Alphabet closed at $151.47 (+2.58%) with volume of 26.972M shares [0]. Both companies trade at similar P/E multiples of approximately 27-28x, with market capitalizations of $1.63T (META) and $3.40T (GOOG) respectively [0].

The modest positive market reaction suggests the designation increased investor attention without triggering significant institutional repositioning [0][1]. The full BetterInvesting analysis in June/July 2025 will provide more detailed valuation methodology and peer comparisons that could offer deeper insights into the relative attractiveness of these technology giants [1].

Investors should monitor upcoming earnings releases, regulatory developments, and the publication of the complete BetterInvesting study to assess whether current valuations are justified based on fundamental performance and growth prospects [0][1].