Meta Platforms Inc. (META) is confronting a familiar Wall Street conundrum: its newest product is a consumer hit, but the market still values the social media giant like an advertising company rather than an AI platform.
The Menlo Park, California-based company released Muse two weeks ago — an AI personal agent that carries out multi-step tasks on behalf of users — and the app has since shot to the top of the free charts on both Apple’s App Store and Google Play in the United States. Within its first five days, Muse drew nearly 750,000 installs on U.S. iOS devices, according to figures cited by Seeking Alpha; Motley Fool separately put the number at roughly 600,000. User reviews have been broadly positive.
The early uptake drew immediate comparisons with ChatGPT in its launch phase. “The market has been hyper-focused on the enterprise AI market — excessively focused,” Evercore ISI analyst Mark Mahaney said in an investor note, echoing the prevailing assumption that businesses will pay for productivity tools while consumers will not. Muse, marketed directly at consumers and well received, is challenging that thesis.
Shares of Meta surged 11.4% on Monday and have risen about 21% since Muse was unveiled. Wells Fargo lifted its price target to $796 from $640 the same day, citing the success of the Muse Spark large language model and the new assistant. Evercore reiterated an outperform rating with an $860 target, while Mizuho maintained its outperform call at $750.
Mahaney went further, calling Muse “the product cycle catalyst” that could unlock Meta’s stock and drive a valuation re-rating to 25 times estimated earnings — about $810 based on 2027 estimates — or even 30 times, or $975, drawing a parallel to the rally in Alphabet’s GOOGL shares following the successful launch of Gemini 3 last year. He cautioned that the call is aggressively early.
Yet for all the enthusiasm around Muse, Meta’s valuation still looks restrained by legacy standards. The stock trades at roughly 25 times earnings, below the broader S&P 500 multiple, even as the company is projected to grow revenue 26.5% this year to about $254.1 billion — a forecast that does not yet factor in any contribution from Muse.
Investors have long been skeptical of Meta’s AI ambitions. Its Reality Labs unit loses close to $20 billion a year on the metaverse bet, denting confidence in Chief Executive Mark Zuckerberg’s judgment. Regulators have also loomed large, including a $17 billion settlement tied to unsafe content for children. Against that backdrop, the market has continued to price Meta as an advertising business, not an AI platform.
The monetization path for Muse is already taking shape: premium tiers are priced at $20 to $100 a month. Zuckerberg has framed the product as a tool that ultimately pays for itself. “We think that this thing is actually going to make you money and save you money, and that is how it’s going to pay for itself,” he said.
Meta’s reach — roughly half the world’s population uses its family of apps — and its entrenched position in digital advertising and e-commerce give it multiple routes to monetize an agentic AI product, analysts said.
Skeptics remain. Julia Ostian, a Seeking Alpha analyst, said it was too early to know what the long-term use cases for these agents will actually be. Investors will get another read this week. Meta Connect 2026, the company’s annual developer conference, takes place September 23–24 at its Menlo Park campus. Management is set to unveil a Connector platform and preview additional AI products and tie-ins.
For a company still valued at just 25 times earnings, the stakes are clear. Muse could mark the start of a second growth curve for Meta — or prove to be another overhyped technology narrative. The next several quarters will tell which story the market ultimately believes.
