It hasn't been a fun year for social media conglomerate Meta Platforms (META 0.94%). The stock price has been down more than 20% over the past year, underperforming the market. But if you're feeling bummed about your Meta shares, there is some good news and the low share prices now will likely make you richer over the long term.

How is this possible? It has to do with how much Meta spends on share repurchases. The company has been allocating more toward buybacks than almost any company on Wall Street. You may not know it, but CEO Mark Zuckerberg is doing Meta investors a favor. Let's take a closer look at why investors should put a smile on and look at their Meta stock in a new light.

Printing cash amid the drama

Meta Platforms is the world's largest social media company and owner of platforms like Facebook, Instagram, and WhatsApp that have a combined 3.59 billion monthly active users. Meta collected $117 billion in revenue in 2021, most of it from selling ads to the audiences on its social platforms.

Young phone user smiling at their screen.

Image source: Getty Images.

Facebook has been a cash cow for years, generating tons of profits because its social media platforms don't require much money outside of spending on research and development. See below how smooth Meta's growth has been, growing revenue an average of 41% per year over the past decade. Impressively, about $0.33 of every revenue dollar ends up as free cash flow, giving Meta billions of excess dollars to play with each year.

FB Revenue (TTM) Chart

FB Revenue (TTM) data by YCharts.

You probably wouldn't see growth and profits like this and believe the stock is significantly down, but Meta has stubbed its toe in recent months. The company is occasionally in the crosshairs of politicians, who argue that social media companies have too much influence. Additionally, Meta had a weak fourth quarter in 2021 -- changes to Apple's iOS privacy policies negatively impacted its ability to effectively target users with ads. This drama isn't ideal, but Meta's stellar financials give me confidence in the business.

A depressed valuation is an opportunity

However, the market doesn't care much for drama, and Meta's seen its valuation crushed over the past year. Even after the stock has rebounded off of its lows, it's still trading at P/E ratios near the lowest they have been in a decade.

FB PE Ratio (Forward) Chart

FB P/E Ratio (Forward) data by YCharts.

Analysts believe that Meta will grow earnings-per-share (EPS) by an average of 13% annually over the next three to five years. Walmart estimates call for average annual EPS growth of 5% over the same time frame, yet the stock is valued noticeably higher than Meta.

The part you've been waiting for

If Meta is so head-scratchingly cheap, why should investors be celebrating? Other than the opportunity to buy more stock at an attractive valuation, Meta is one of the most aggressive companies on Wall Street regarding share repurchases.

Share repurchases take shares off the market, which means that cash flow and profits are spread across fewer shares, making them worth more. Like an investor buying shares at a low valuation, Meta is getting more "bang for its buck," retiring more shares for the same amount of buyback investment.

The below chart shows the magnitude of these repurchases, totaling $44 billion over the past year, more than Walmart makes in total profits each year. Meta is still producing billions in cash flow each year and has $48 billion in cash on its balance sheet to draw from as it desires.

FB Cash and Short Term Investments (Quarterly) Chart

FB Cash and Short Term Investments (Quarterly) data by YCharts.

Long-term investors will benefit from Meta taking more shares off the market, so while it's no fun to see stock prices fall, a more prosperous Meta shareholder of the future might look back on their portfolio during this time and be grateful for the temporary pain they felt.