A Historic One-Day Value Destruction Event
The fallout from Facebook's dramatic post-earnings plunge rippled across markets Thursday, undermining risk sentiment and threatening to upend a nascent rally that saw the FAAMG cohort add back $870 billion in value from the January lows.
A wave of price target cuts for Meta were accompanied by cautiously constructive commentary, even as analysts were forced to reckon with headwinds that one bank euphemistically described as "clearly larger than envisioned."
A 20% drop in Facebook shares would
If there was an ETF that mirrored SPY/VOO minus Tsla and FB, I would buy it.
Hyundai is going to eat Tsla’s lunch- either Tsla shifts to even more excellent batteries or they will be crushed. A tsunami of well built and strong performance e-cars is coming.
I have never been on Facebook- evidently, I am missing out on “so much”- but when something lacks substance, people generally can easily leave that behind and instead go for the next new, shiny toy.
Your take on Facebook is wise. However, FB could have been something of substance. They failed. They even admitted it when they announced Meta which they not only stole from another company, but they’re using it wrong. It doesn’t mean what they think it means.
When will the punters understand that no company can grow faster than the economy indefinitely? The majority of industries in the economy are in decline (industries = groups of companies providing products or services that are close competitors to one another). Our current “growth” companies will lose this status in the near to intermediate future and people should not be too shocked when it happens. Think about it, Zuk claims nearly 2 billion people are on FB every day. That’s more than a quarter of the world. An equal amount of the world’s pop can’t even get a glass of potable water. How many more can we reasonably expect to get on FB? Why would people who are barely surviving want to be stupid self-centered idiots posting pictures of the bugs they managed to scrape together for their dinner?
@Mr. Lucky, I think the idea is they put on VR goggles and suddenly their scrap of desert is St. Moritz and their bugs are foie gras.
Jyl- you have to watch the movie, “WALL-E”. So funny- in a disturbing sort of VR way.
I’m surprised we haven’t seen more generalized market contagion given FB approx 1.9% of SPY and 3.8% QQQ…perhaps more will be coming….
FB is now a case study on the impact of no growth to the valuation of a growth stock: about minus 25%. Yet, its share value is still at or just above its pre-pandemic high.