Meta Platforms' New Bull: Why Billionaire Bill Ackman Is Buying

Key Points

• After a post-earnings surge, shares of Meta Platforms are getting hit.
• However, a high-profile investor is showing his support, investing around $2 billion in the company.
• Pershing Square and Bill Ackman are clearly recognizing the power of Meta's AI-enabled advertising empire.

Magnificent Seven giant Meta Platforms NASDAQ: META, despite failing to hold recent gains, has just received backing from a massive investor.

Meta shares soared over 10% on Jan. 29, as investors reacted to the firm’s latest earnings report. The stock closed at approximately $738 that day.

Since then, however, shares have given up all of those gains and more, closing near $640 on Feb. 13. This comes even though Meta is forecasting 30% revenue growth next quarter, something it hasn’t achieved since 2021.

Still, big fish are buying into the company’s story. This includes Pershing Square Capital Management, headed by billionaire Bill Ackman. Ackman’s initial fame came from his shorting of the Municipal Bond Insurance Association (MBIA). MBIA had significant exposure to subprime mortgage-backed securities during the Great Financial Crisis. Ackman generated huge returns from this play after MBIA’s stock collapsed.

In general, Ackman’s willingness to put his investments into the public eye has given him a place in the financial zeitgeist. Let’s dive into Ackman’s investment in Meta and his highly bullish statements around the firm.

Pershing Takes Huge Stake in META

Pershing Square released its 2026 Annual Investor Presentation on Feb. 11. The presentation stated that Meta accounts for 10% of the company’s capital as of the end of 2025.

This makes the investment equal to approximately $2 billion. Pershing directly pushed back on one of the key fears around Meta in its presentation.

“We believe Meta’s current share price underappreciates the company’s long-term upside potential from AI and represents a deeply discounted valuation for one of the world’s greatest businesses.”

Notably, Pershing says as of Nov. 24, 2025, it purchased Meta at an average price of $625. This is significant, considering that Meta’s Feb. 13 closing price is less than 3% above this level.

This, along with Pershing’s statements, suggests that it still sees a lot of room for upside ahead in META shares.

Detailing Pershing’s Investment Thesis on META

Pershing’s presentation (slide 65) details the key strengths that it sees in Meta’s business. Importantly, the slide does not mention Meta’s general purpose AI models, or the potential that it will become a leader in this domain. This is notable, as some investors view the company’s lack of progress here as a sign that it will not reap enough benefits from its massive AI spending. Pershing’s slides implicitly push back on this idea.

Pershing focuses on the fact that AI is driving success in the company’s most important driver: its core advertising business. It states “Meta’s business model is one of the clearest beneficiaries of AI integration.”

Specifically, Pershing notes that Meta’s AI-driven content recommendation systems are improving user engagement. Furthermore, leveraging AI allows the company to deliver more relevant and personalized advertisements to users.

Investors can overlook the importance of this in discussions around Meta’s AI strategy. Hyperscalers like Google parent company Alphabet NASDAQ: GOOGL, Microsoft NASDAQ: MSFT and Amazon.com NASDAQ: AMZN have been able to more clearly show the gains their AI investments are generating. Much of this comes through their cloud businesses as customers rent AI infrastructure.

Meanwhile, Meta’s AI-backed progress is more difficult to see, embedded within the growth of its advertising business.

The key to Meta’s strategy is maximizing the return on advertising spend (ROAS) that businesses can generate. ROAS improvements, driven by AI, increase the likelihood that businesses will spend more of their advertising budget on Meta’s apps.

With over 3.5 billion users, Meta has an absolutely massive pool of potential customers that businesses can target. However, supporting improved targeting and engagement across this huge user base also requires large AI investments. This dynamic challenges the idea that Meta’s spending will not yield an adequate payoff.

META’s Ads Business Needs to Keep Chugging

Overall, Pershing’s investment is clearly a positive sign for Meta’s outlook. Meta’s revenue growth accelerated in every quarter during 2025, and it expects growth to accelerate again next quarter. This provides strong evidence that Meta’s AI strategy is working. However, the company still has a lot to prove. While Meta’s recent growth is impressive, continuing to drive upgrades in its advertising business remains central to its bull thesis.