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Meta's stock declined nearly 10% after the company issued a revenue forecast that missed expectations alongside reports of thinning free cash flow. The case against the stock writes itself from those two datapoints.
What complicates it is that Meta also narrowed its capital expenditure range for the year, a move that cuts in two directions depending on which way the narrative runs.
When guidance and cash both soften A weaker-than-expected revenue forecast from a company of Meta's size is rarely absorbed without a meaningful re-rate.
The concern is less about one quarter than about what the guidance implies going forward, particularly when free cash flow is already under pressure at the same time.
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