Author Topic: Is Twitter the canary in the coal mine?  (Read 3107 times)

Roland of Gilead

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Is Twitter the canary in the coal mine?
« on: May 06, 2014, 04:31:14 PM »
If so, the canary just died.  This may mean the coal mine is poison.

The market may be waking up to the fact that a company has to eventually have earnings.

If so there are quite a few other companies in trouble...*cough* Amazon *cough*

Eric

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Re: Is Twitter the canary in the coal mine?
« Reply #1 on: May 06, 2014, 05:28:03 PM »
This may mean the coal mine is poison.

The whole mine isn't poisonous.  There's just some poisonous gases that need vented.  The coal is just fine.

tod

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Re: Is Twitter the canary in the coal mine?
« Reply #2 on: May 06, 2014, 05:43:23 PM »
Amazon could easily post earnings if they wanted to, but they choose to invest in the future instead.

smedleyb

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Re: Is Twitter the canary in the coal mine?
« Reply #3 on: May 06, 2014, 05:54:37 PM »
If so, the canary just died.  This may mean the coal mine is poison.

The market may be waking up to the fact that a company has to eventually have earnings.

If so there are quite a few other companies in trouble...*cough* Amazon *cough*

Most high-beta tech has taken it on the chin the past couple of months.  The fact that the SPX is still a stone's throw away from all time highs in spite of the tech carnage is either a bullish sign (the market working through pockets of bullish excess), or it is the ultimate canary in the coal mine (twitter being just the latest tech darling to be taken out behind the woodshed and shot) signaling a more significant general market decline.  I realize you have a particular kind of tech stock in mind (those with no earnings but hitting all sorts of bullish metrics analysts use to justify the nosebleed valuations), but they all (TSLA, FB, TWTR, LNKD, NFLX, AMZN) trade in tandem. 

 


timmoney

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Re: Is Twitter the canary in the coal mine?
« Reply #4 on: May 06, 2014, 11:07:34 PM »
 forget twitter, facebook, linked in etc.   my favorite stock/investment is howard hughes, symbol HHC and fpa crescent fund, symbol FPACX

hodedofome

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Re: Is Twitter the canary in the coal mine?
« Reply #5 on: May 07, 2014, 08:08:34 AM »
Yes, there have been pockets of bubblishness in the social media and biotech stocks. Hopefully those can be corrected apart from the rest of the market. The problem becomes when the same people hold 'safe' stocks as well as the high beta ones. If they start getting margin calls on the high beta, they might be forced sellers of the 'safe' to cover it. Stocks that might have been uncorrelated suddenly become linked in times of stress.

It will be interesting to see if this is the case.

foobar

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Re: Is Twitter the canary in the coal mine?
« Reply #6 on: May 07, 2014, 08:33:54 AM »
The stock is still trading roughly at its offering price.  When it gets down to 5 bucks you can talk about it dying.  See ZNGA for an example of a stock that died (although it looks like they have had a bit of rally the past couple months).  People like to say this is like the dot.com boom all over again.

Earnings matter. But todays earnings are no where near as important as what 2020 earning will be. 

If so, the canary just died.  This may mean the coal mine is poison.

The market may be waking up to the fact that a company has to eventually have earnings.

If so there are quite a few other companies in trouble...*cough* Amazon *cough*

The Cook

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Re: Is Twitter the canary in the coal mine?
« Reply #7 on: May 07, 2014, 11:43:17 AM »
I have no idea what is a proper valuation for Twitter, but I would be surprised if it was dead. Too many users for it to go away. They do need to figure out how to balance todays growth expenditures against their perceived future value as a real business. Amazon has gotten away with the "we don't need to be profitable because we invest for world domination tomorrow." line for many years. It works for them because we can actually see that they sell everything to everyone. Twitter? Just not as clear, but dead? Seems way early to make that call.

TC

Nords

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Re: Is Twitter the canary in the coal mine?
« Reply #8 on: May 07, 2014, 08:54:59 PM »
If so, the canary just died.  This may mean the coal mine is poison.

The market may be waking up to the fact that a company has to eventually have earnings.

If so there are quite a few other companies in trouble...*cough* Amazon *cough*
Gee, is it May already?