Following Meta Platforms Inc's (NASDAQ:FB) weak earnings results, the stock tanked and is now down more than 30% since the start of the year. "Shark Tank" investor and O'Shares ETFs chairman Kevin O'Leary thinks the stock has fallen far enough.
"This is the bottom," O'Leary said Wednesday on CNBC. "This is where you want to accumulate."
O'Leary's Thesis: It's very rare to see one of the FAANG names fall so dramatically in such a short period of time. Even though retail investors own a portion of the shares, the vast majority are owned by institutions, he said.
Investors should be asking themselves when the institutions will decide to reindex their Meta positions, O'Leary said. It's likely that Meta has fallen to a 2% to 3% weighting in institutional portfolios, but he expects that to change. After speaking to institutional players, he thinks they will begin accumulating again around current levels.
"People who are calling for a $200 price, it ain't gonna happen," O'Leary emphasized.
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What's Next: He told CNBC that he bought more Meta shares today. He continues to expect that Meta will be the leader in the virtual reality space because of the need for a "curated metaverse."
O'Leary also noted that he isn't worried about signs of a slowing ad business. Apple Inc's (NASDAQ:AAPL) operating system changes caused a drop in advertising yields during the quarter, but the company is already addressing the impact, according to O'Leary.
"If you don't think they have a bunch of engineers working on enhancing yield on advertising, you'd be wrong," he added.
FB Price Action: Meta spiked higher during Wednesday's trading session following the bullish commentary from O'Leary.
The stock was up 5.25% at $231.74 at the time of publication.
