All Hail

All Hail

Good news: Amazon, Facebook, and Alphabet aren't going out of business anytime soon. All three tech titans reported results that breezed past estimates on Thursday evening in the US. While there's plenty of scope for the market to find something to dislike in the details, the headline numbers suggest that if a serious de-rating is in the cards for the names that have shouldered much of the burden in a virus-blighted 2020, it won't be attributable to these quarterly numbers. And it's a good thi
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6 thoughts on “All Hail

  1. It’s hard to believe that these guys collectively blew the doors off estimates, despite being so widely covered and scrutinized.

    But doesn’t it strike you as fishy that all 4 report these blowouts on the same day, which just happens to be ONE day after their big antitrust hearing? I mean surely that can’t be coincidence. Was the House even aware of this timing, or were they complicit (or duped) in holding the hearing beforehand so as to not pour more fuel onto the monopolistic bonfire?

    For now, I’m going with duped.

    1. well, i mean the dates were set ahead of time obviously. and Facebook’s report was pushed back to accommodate the hearings. and the hearings themselves were rescheduled. so, yeah, everybody was fully aware of the timing.

  2. I like the biz models but reading this makes me wonder if a bell is being run. Thus is what people right at tops. BUT hard to make a too neg of a fundy case. Am worried about AWS and biz bankruptcies/closures. A WMT online line plus advertising is a diff mult. AAPL upgrades with 10% unemployment is a risk. And in and on. And of course those pesky comps and multiples. Just some things I am thinking of. Reminds me a bit of the Nifty 50 but with better biz fundies.

    Feel free to either praise these thoughts or rub them in this time next year.

  3. H, let me make the case. Divergences.

    Much of the markets rise has been based on the thought that in the future companies that are now down will rebound and are now good deals to buy while they are low. Discount the present valuations because the futures so bright you gotta wear shades.

    What we are seeing now is extremely high valuations for a few companies based on NOW but what is the return from these lofty levels for the future? If I am to discount poor valuations for most companies in the present then I should discount high valuations as well. Any reversion to the mean says that these massively valued stocks will almost never pay off at these valuations. This I suggest, is the high water mark or very near for these companies and smart investors will start to bail.

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