This Artificial Intelligence (AI) Innovator, Up 557% in 2 Years, Could Be the Next Stock-Split Stock

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When management announces a stock split, it usually comes after a long run-up in the company's stock price. And while a split doesn't change any of the underlying fundamentals of a business, it's a strong signal from management that they believe the stock will continue to appreciate over time. It's no surprise then that investors flock to stock-split stocks to capitalize on the momentum and the signal management's sending.

But even better than buying shares after management announces a stock split is buying shares before the announcement. Since reaching an intra-day low about two years ago, the share price of one of the leading artificial intelligence (AI) companies in the world has climbed 557%. And despite shares soaring to new all-time highs this year, there's still a lot of potential left in the business.

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That's why investors should consider buying shares of Meta Platforms (NASDAQ: META).

A penny, split in half, sitting on top of a share certificate.
Image source: Getty Images.

Betting big on artificial intelligence

AI has always been a big part of Meta's business, from figuring out the most relevant item to show next in your Facebook or Instagram Feed to helping marketers build and target their ad campaigns. Over the last two years, though, Meta has significantly increased its investment in various forms of AI across its business.

One big reason for the step-up in investment was the introduction of Reels, Meta's TikTok competitor. Reels engagement is heavily reliant on an AI algorithm recommending great content. Meta has not only developed a better content recommendation engine that surfaces more relevant and engaging Reels for users, but it's applied the same general algorithm to more and more content across its various surfaces (Feeds, Stories, etc.).

It's found that more general recommendation engines, instead of very specific ones, actually perform better. That's reflected in total ad impressions increasing 10% in the second quarter while Meta also increased its average price per ad by 10%.

Meta's also working on AI for advertisers. It's currently able to suggest targeting criteria for marketers, but CEO Mark Zuckerberg eventually sees AI handling all the heavy lifting of developing an ad creative, testing variations, and building an entire campaign based on a set budget and objective. It already offers some AI-powered features through its Advantage+ tools for shopping and app install ads.

Perhaps the most noticeable impact of AI on the user experience is the rollout of Meta AI in Meta's various messaging services. Meta AI is an AI assistant similar to OpenAI's ChatGPT. Zuckerberg has a goal of making it the most-used AI assistant by the end of 2024. As of the end of August it had 185 million weekly users, almost as many as ChatGPT's 200 million.