What happened
Microsoft has fallen nearly 20% in 2026, while Meta is down around 12%, despite strong underlying business performance. Microsoft's Copilot business generates $37 billion（約5.9兆円） in annual revenue growing at 123% year-over-year, and its Azure cloud division grew 40% year-over-year in its most recent quarter. Meta's advertising revenue grew 33% year-over-year in Q1.
Why it matters
Both stocks trade at discounts to the S&P 500—Microsoft at 20.2 times forward earnings versus the S&P 500 at 21.7, and Meta at 17.9 times forward earnings. The article argues this undervaluation does not reflect their growth rates and strategic positions, suggesting the market may have overweighted concerns about AI spending returns.
What to watch
Microsoft owns around 27% of OpenAI, which may be worth more than $1 trillion（約160兆円） when it reaches the public market. Meta's longer-term upside depends on delivering a superintelligent AI model that works with AI glasses—a goal that may be a few years away.
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Microsoft and Meta represent a valuation disconnect in today's market. Both companies are executing well on their core businesses—Microsoft's AI-integrated productivity tools and cloud infrastructure are driving substantial revenue growth, while Meta's advertising platform continues to generate strong returns. Yet the market has punished both stocks, potentially because investors are skeptical about the near-term payoff from massive AI infrastructure spending. Microsoft trades below the broader market multiple despite Copilot's explosive growth and Azure's 40% expansion, suggesting the market may underestimate the durability of these AI-driven revenue streams.
Meta faces a different but related skepticism: the market acknowledges its advertising dominance but questions whether the hundreds of billions in AI spending will eventually justify itself. The article frames this as a near-term disconnect—Meta's core business is strong, but investors are pricing in longer-term uncertainty around AI glasses and superintelligent models. This mismatch, the analyst argues, creates an opportunity for long-term investors who believe the market will eventually revalue these stocks based on their demonstrated growth and strategic positioning rather than current AI spending concerns.
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