Earnings season has a way of humbling you, no matter how many charts you stare at or narratives you convince yourself are “obvious.” And as Meta reports earnings, I’m staring straight at one of those humbling moments: a 1/30 $662.50 put that’s very likely about to go the wrong way.
Let’s be real upfront this trade is not about perfect timing or flawless execution. It’s about conviction colliding with reality. Meta has been on an absolute tear. The stock has climbed relentlessly, powered by AI optimism, aggressive cost-cutting, and Wall Street’s renewed love affair with Big Tech margins. Every dip has been bought. Every concern has been shrugged off. From a price action standpoint alone, betting against Meta right now feels like stepping in front of a freight train and hoping it taps the brakes.
And yet, here I am!
The thesis wasn’t crazy. Valuation is stretched. Expectations are sky-high. Any slight disappointment weaker ad growth, higher AI spending, cautious guidance could trigger a pullback. In theory, earnings are exactly when gravity is supposed to reassert itself. In theory.
In practice, Meta has trained the market to forgive almost everything. Spend more on AI? Long-term bullish. Margins compress temporarily? Strategic investment. Regulatory noise? Already priced in. The bar for a real downside surprise is much higher than it looks.
Here’s how the company did, compared with estimates from analysts polled by LSEG:
- Earnings per share: $8.88 vs. $8.23 estimated
- Revenue: $59.89 billion vs. $58.59 billion estimated
Meta said it expects first-quarter sales to come in the range of $53.5 billion to $56.5 billion, ahead of analyst estimates of $51.41 billion.
I'll have to keep you all posted on how much I loose tomorrow. Max loss is $1,800 for this trade...