News · Yahoo Finance

Meta’s New Convertible Stock Could Yield More Than 6%. How It Compares With Common Shares.

Meta's new offering is a so-called mandatory convertible preferred stock. It is expected to carry a dividend yield of 6% to 6.5%.

Summary written by Upside AI from the original article. Read the source for full details.

Read the original on Yahoo Finance ↗

Keywords

METAfundraisingvaluation

Open a keyword to see other news on the same topic.

Related tickers and likely impact

META

▼ Likely negative

Meta Platforms

Relevance: low

MarketUS stocks
SectorCommunication Services
IndustryInteractive Media & Services
Market cap$1.7T
Close on 10/23/2026642.62
Change that session-0.96%
META price, forecasts and signals →

Impact is scored by AI from the headline and may be wrong. It is not investment advice.

Related news

  • Meta Just Priced a Stock Sale at $625 a Share. I'd Consider Buying at the Same Price.

    Meta priced 40 million Class A common shares at $625 each, about $25 billion, and 250 million mandatory convertible preferred depositary shares at $50 each, worth about $12.5 billion, for roughly $37.5 billion in total. Net proceeds from the common stock are expected at about $24.9 billion once the forward sale agreements settle, while the preferred pays a 6.5% annual dividend. The new common shares and the shares the preferred could convert into would lift the share count by about 2.2% to 2.3%. Management expects 2026 capital expenditures of $135 billion to $145 billion, while third-quarter advertising revenue rose 26% to $63.1 billion. The author says the dilution cost is lower than the $37.5 billion figure suggests, and would consider investing at about the price the new investors paid.

    Yahoo Finance·▼ METAMETAvaluationfundraising
  • Meta Platforms (META) Could Be 39% Undervalued Following Its AI Funding Push

    Meta Platforms completed a US$25b follow-on offering of Class A stock and a US$12.5b convertible preferred deal to fund its AI buildout, alongside collaborations with Nvidia and AMD. After heavy selling since late September, the shares closed at US$620.19 after a 1.64% drop, down 17.49% over 30 days and 4.65% year to date, though the 5-year total shareholder return is up 90.85%. Investor concerns cited include negative free cash flow, a planned US$95b equity program and legal penalties, while capex reached $72.2 billion in 2025 and 2026 guidance has been raised to US$125b–US$145b. The article's narrative fair value of $1,018.71 implies the stock is 39% undervalued, but its DCF model puts value at $606.53, slightly below the share price.

    Yahoo Finance·▲ METAMETAAI investmentvaluation
  • Meta plans $95bn fund raise for AI infrastructure and personal superintelligence

    Meta plans to raise up to $95bn through equity offerings to fund AI infrastructure and personal superintelligence, including about $35bn in concurrent underwritten offerings. Nvidia, AMD and Broadcom have expressed non-binding interest in buying up to $5bn of Class A shares, and a $60bn at-the-market programme for Class C stock is planned to start after trading begins in the first quarter of 2027, though it has not yet been established. Meta expects 2026 capital expenditure of $135bn-$145bn; revenue rose 26% to $64.6bn in the latest quarter, but capex of $34.9bn pushed free cash flow to negative $2.1bn. The company held $82.5bn in cash, cash equivalents and marketable securities at the end of September. The move follows Alphabet's $80bn equity raise in June and SpaceX's approximately $40bn master finance lease with an Apollo-managed entity.

    Yahoo Finance·• META▲ NVDAMETANVDAAI investment
  • Stock Market Today, Oct. 27: Meta Raises Largest-Ever Equity Offering to Nearly $98 Billion to Fund AI Infrastructure Bet

    Meta Platforms closed at $620.19, down 1.64%, on trading volume of 50.4 million shares, about 148% above its three-month average. The company projects its 2026 AI infrastructure spending at $135 billion to $145 billion, versus $72.2 billion in 2025. Its equity offering, originally targeted at $95 billion, was upsized by $2.5 billion to $97.5 billion after the Class A offering was oversubscribed fivefold, consisting of $25 billion of Class A common stock, $12.5 billion of mandatory convertible preferred shares, and $60 billion through a Class C non-voting share at-the-market program scheduled for early 2027. Nvidia and AMD said they would invest a combined $4 billion in Meta as part of deepening AI partnerships, easing some financing concerns. Meta's third-quarter revenue rose 26% to $64.6 billion with guidance above expectations, but investors remained focused on rising capital expenditures.

    Yahoo Finance·▼ METAMETAfundraisingAI investment
  • Meta's $97.5B AI money grab: why Zuckerberg is racing to raise cash before rivals

    Meta priced a $37.5 billion offering of $25 billion in Class A common stock at $625 per share (up from $22.5 billion) and $12.5 billion of mandatory convertible preferred stock paying a 6.50% annual dividend. It also plans an at-the-market share sale program of up to $60 billion, not expected to start before Q1 2027, when its non-voting Class C shares are expected to begin trading, bringing the potential total to $97.5 billion. The article says Meta is moving early as competition for AI funding intensifies, with rivals such as Anthropic, OpenAI, Alphabet and SpaceX pursuing large AI plans and Anthropic possibly raising up to $100 billion in its IPO. According to the piece, this is a strategy rather than a sign of running out of money, aimed at keeping funding from constraining its AI ambitions.

    Yahoo Finance·▼ METAMETAAI investmentfundraising
  • Meta Wraps Up First Phase of Equity Financing—$37.5 Billion. Convertibles Yield 6.5%

    Meta has completed the first phase of its $37.5 billion equity financing. The company also plans to issue as much as $60 billion of nonvoting class C common shares in an at-the-market offering, distributed on a one-for-one basis to class A and class B holders in January.

    Yahoo Finance·▼ METAMETAbondsfundraising

Related markets

US stocks →

Latest news

  • Why gold plunged to its lowest price in a year despite renewed Iran jitters

    Safe-haven gold fell to its lowest price in a year. The drop came despite renewed jitters over possible fresh Middle East attacks after the U.S. midterm elections on Tuesday.

    MarketWatch·▼ XAU/USD▼ PAXG/USDT▼ XAUT/USDTgoldIrangeopolitics
  • These 3 Big Risks Could Cause the Next Bear Market. I'm Investing Anyway.

    The article argues that stocks always carry risk, pointing to the 2022 bear market when the S&P 500 fell about 18% and the Nasdaq-100 about 32% on a total return basis. The author outlines three risks: heavy reliance on AI, as Goldman Sachs research from September found the largest AI hyperscalers had spent about $800 billion in capital expenditures since the start of the year; rising rates, as the Fed hiked in September and the 10-year Treasury yield has risen about 0.92% over the past year; and high valuations, with the CAPE ratio at levels not seen since 2000, just before the dot-com crash. Even so, the author says they will keep investing and buying more stocks through low-cost index funds, noting the S&P 500 has averaged 9.98% annual returns since 1928 and the Vanguard S&P 500 ETF (VOO) about 13.8% a year over the past five years, including 2022.

    Yahoo Finance·▼ SPYS&P 500bear marketvaluation
  • Stock Market Today, Oct. 30: Intel Plunges Nearly 29% as Weak Outlook Rattles Wall Street

    Intel shares plunged 28.58% to close at $65.76, one of the steepest single-day declines in decades, despite the company beating quarterly earnings expectations. Investors reacted to weak fourth-quarter guidance citing softer PC demand, manufacturing constraints and ongoing turnaround spending. Trading volume reached 447.8 million shares, about 314% above the three-month average of 108.1 million. Intel’s Data Center and AI revenue rose 78% year over year to $7.3 billion, suggesting demand for data center infrastructure remains robust. AMD fell 10.88% to $504.80 and Nvidia dropped 4.22% to $204.64, while the Nasdaq Composite closed at 25,437, down 2.86%.

    Yahoo Finance·• NVDAIntelsemiconductorsearnings
  • Cracks are emerging in the AI spending boom

    Investors are growing nervous about AI infrastructure spending, even as Alphabet, Amazon, Meta and Microsoft plan to spend more than $740 billion on capital expenditures this year. The Nasdaq fell 2.9% on Friday, with chip stocks hit hard and Qualcomm down 11%. Alphabet plunged 12% on Thursday, wiping out $500 billion in market value, and reported negative free cash flow of $9.1 billion in the third quarter while expecting to spend up to $205 billion this year, as its Search advertising growth slowed to 12% amid the rollout of AI Mode. Amazon posted negative free cash flow of $42.4 billion over the past 12 months despite 39% AWS growth, and Meta reported negative free cash flow of $2.1 billion in the third quarter even as ad revenue rose 26%. Negative cash flow, mounting debt and doubts about whether these investments will pay off are weighing on market sentiment.

    Yahoo Finance·▼ NVDA▼ MSFT▼ AMZN▼ GOOGLAI investmentsemiconductorsGOOGL
  • Binance Hack Shows Why Offshore Exchanges Need US Oversight, CFTC Chair Says

    CFTC Chairman Michael Selig told CNBC that the $6.4 billion Binance hack “proves our exact point” for the crypto-market rules the agency proposed this month, arguing offshore exchanges need U.S. oversight. He attributed the flaw to a vulnerability “introduced from someone’s laptop” rather than to Ethereum or its smart contracts, and proposed a “federal option” letting such venues register with the CFTC and meet U.S. cybersecurity standards. Binance, however, said its investigation had found “additional points of breach,” and that the attacker used EIP-7702 to turn a hot wallet into a “sweeper” with 50 pre-signed authorizations. Binance has set aside $6.34 billion to cover losses, while the Secret Service and FBI are investigating, and TRM Labs and Chainalysis have linked the theft to North Korea’s TraderTraitor group.

    Decrypt·▼ BNB/USDT• BTC/USDT• ETH/USDTBNBcryptocybersecurity
  • Anthropic turns profitable but could go back into losses: Seaport analyst

    Seaport Research Partners analyst Jay Goldberg views Anthropic's operating profit of almost $1 billion as likely temporary. He said the company has warned it may be profitable in the next quarter or two before returning to losses, as it shifts from leasing computing capacity by the hour from Amazon to building its own compute, which it considers a key competitive advantage and will spend heavily on. Goldberg described the relationship with Amazon (AMZN) and Google (GOOG, GOOGL) as complex, since Anthropic is both a major customer, with a large share of Amazon's AI revenue coming from it, and a potential competitor. He does not think conclusions about Anthropic can be drawn from this week's tech market moves, citing interest rates and an ongoing war. Anthropic's computing bill is falling quickly, which is good news for now, but that is expected to reverse as it starts buying its own compute.

    Yahoo Finance·▲ AMZNAnthropicartificial intelligenceAMZN

All news →

Get the briefing on Telegram or Zalo

Join the Upside Telegram channel or Zalo group for the Vietnam stocks and gold briefing at 8:00 and 19:00 (Vietnam time) on trading days, plus a weekly wrap on Saturday morning.