Share prices of Meta Platforms (META 0.84%) have been red hot on the market in 2023 with outstanding gains of 146% so far, but the company's latest quarterly results somehow brought that impressive rally to a halt.

Meta stock fell 4% after the company released third-quarter results on Oct. 25. Though the tech giant easily crushed Wall Street's expectations and delivered healthy year-over-year growth, investors were quick to press the panic button as its guidance for the current quarter fell slightly below expectations.

Savvy investors may want to capitalize on this recent dip in Meta stock, as its guidance is not all that bad. More importantly, the company seems to be gaining share in a lucrative market that should translate into healthy long-term growth. Let's look at the reasons why buying this tech stock right now could turn out to be a smart long-term move.

Meta Platforms is now growing at an impressive pace

Meta Platforms' Q3 revenue increased 23% year over year to $34.1 billion, easily exceeding the consensus estimate of $33.6 billion. The company's earnings increased a whopping 168% from the year-ago quarter to $4.39 per share, which was well ahead of Wall Street's expectation of $3.64 per share.

The robust growth in the company's top and bottom lines can be attributed to the improving sentiment of the digital ad market, as well as Meta's focus on keeping its costs in check by reducing its workforce, among other initiatives. More specifically, Meta's costs and expenses were down 7% year over year in Q3 to $13.7 billion.

The guidance, however, wasn't as solid as analysts were looking for. Meta anticipates Q4 revenue to land between $36.5 billion and $40 billion. The midpoint of that range stands at $38.25 billion, which is a shade below the $38.8 billion consensus estimate. Meta management pointed out on the earnings call that the Q4 guidance "reflects the greater uncertainty and volatility in the landscape ahead," referring to the ongoing conflict in the Middle East that may hurt advertising spending.

But the guidance points toward a 19% year-over-year jump in revenue. Based on the midpoint of Meta's Q4 guidance, the company is set to end the year with a top line of $133 billion. That would translate into a 14% increase over last year when the company's revenue fell 1% to $116.6 billion.

It is worth noting that overall digital ad spending is anticipated to grow by 9.5% in 2023 to $602 billion, and Meta's annual revenue estimate suggests that it controls around 22% of this market. More importantly, Meta's forecasted growth for 2023 indicates that it is set to outperform the industry it is operating in. That's not surprising, as Meta's massive user base continues to expand. The number of monthly active people across its family of apps increased 7% year over year last quarter to 3.96 billion.

This huge user base is now spending more time on its apps, thanks to the improvements driven by the deployment of artificial intelligence (AI). According to CEO Mark Zuckerberg:

AI-driven feed recommendations continue to grow their impact on incremental engagement. This year alone, we've seen a 7% increase in time spent on Facebook and a 6% increase on Instagram as a result of recommendation improvements.

And this isn't the only way AI is driving gains for Meta's ad business. The company has AI tools that are being deployed by advertisers to optimize their campaigns to drive greater returns on their advertisement dollars. As a result, it wouldn't be surprising to see Meta gain more share of the digital ad market in the future, and that could drive terrific long-term revenue growth for the company.

Investors can expect healthy long-term gains

It is estimated that global digital ad spending could jump to $871 billion in 2027. If Meta continues to win a larger share of this lucrative space and hits a market share of 25%, its top line could jump to almost $218 billion within the next five years.

Multiplying that estimated revenue with Meta's five-year average price-to-sales ratio of 7.5 points toward a market cap of $1.63 trillion. That would be a 114% jump from current levels, indicating that Meta could turn out to be a solid growth stock over the next five years and become a part of the trillion-dollar market cap club.

The stock's recent dip has brought Meta's sales multiple down to 6. That level suggests investors are getting a good deal on Meta that they may not want to miss given the acceleration in its growth this year and its solid long-term prospects.