$META · Schwab Network · 2026-10-26

Initially, we did see a decline in the stock. Then the matter came to light and they talked about there being some appetite, or at least demand and interest, from Nvidia, AMD and Broadcom.

The stock traded higher, but declined just before the start of the trading day.

Well, it's clear we've already seen the stock decline here. This is a unique way for them to be able to raise funds for artificial intelligence. Now, what is very unique about this is that we know about the Class C shares that will be made available, valued at approximately $60 billion, and that will be offered at the current price.

It looks like that will be at the beginning of next year. But they will also issue about $22.5 billion in Class A common stock. This will coincide with a forward sale agreement.

There will also be an offering of Series A mandatory convertible preferred shares. It is worth approximately $12.5 billion. So, this structure isn't just to keep Mark Zuckerberg in California.

This is the type of structure for Class C shares, but they are also trying to raise some money to fund their operations again.

Now, in some respects, this is not a debt offering. Preferred shares are still mostly considered equity. This will indeed put more pressure on the stock's valuation, but they will not be rapidly increasing the debt side of their balance sheet, as we have seen from other companies.

I think if you look at it from a technical point of view, this is an interesting chart setup here. We have already witnessed this consolidation, confidently breaking through the downtrend line here, and now we are going back to test it again.

Therefore, we hope that the former resistance zone will turn into a support zone. You have the 50-week and 20-week moving averages, which will also act as support. Unfortunately, the MACD indicator does not appear to be crossing into a bearish pattern.

If you are optimistic about this stock, you will be able to hold onto these moving averages and see a bounce to the upside and try to make up some of these losses. However, if news continues to come from the company regarding increased funding to finance its artificial intelligence infrastructure, that could also be a negative factor for this stock.

Last but not least, the telecommunications services sector is currently recording its lowest annual levels, due to the performance of Google, Alphabet, and Meta. Therefore, both stocks really need to gain some positive momentum to push this sector higher, and that could also be a boost for the stock market in general.