In an interesting tweet that shows investor herding into a small subset of high-beta stocks, Jeff Macke notes Facebook, Amazon, Netflix, and Google, collectively named (FANG) account for over 90% of S&P 500 market cap gains since December 2014.
Both companies reported tonight.
CNBC reports Google parent Alphabet sees earnings, revenue beat and announces $7 billion buyback.
Amazon is down 5% (down $42 from $818 to $775) in after hours trading on a substantial earnings miss: Amazon Reports 52 Cents per Share, vs. Expected EPS of 78 Cents.
Yahoo Finance reported trailing 12-months Amazon’s P/E at 654. That is before today’s report. Lovely.
Mike “Mish” Shedlock
The collapse will be epic.
Especially after these FANG companies have shown how left wing they are and the lengths they will go to elect Hillary.
Won’t the Fed buy Amazon?
Tony Bennett said:
Bezos’s blog – The Washington Post – has become unreadable.
For months when I pull up the homepage there is anywhere between 6 to 10 attack Trump articles.
The title to one opinion article (did not read) was “Trump not fit to be human”.
Now that I broached politics. Has HRC given up on Florida? Kaine cancelled tomorrow’s Sarasota rally (worried about poor optics after the fiasco of a few days ago?). After tomorrow none of the principals (Kaine, POTUS, Bill, HRC) are scheduled to speak before election.
If Florida has swung Trump’s way …
Tony Bennett said:
er, speak in Florida
Jon Sellers said:
As a native Floridian, I haven’t seen a single Hillary yard sign or bumper sticker. I see way more for Anderson and Stein. Orlando is a largely democratic city and I have to spend some time there for business purposes. Nobody I talk to even considers voting for her. And that includes lots of hispanic ladies.
State Republicans have Gerrymandered Florida to overproduce Republican votes. I don’t see a lot of support for Trump, but he can win Florida. If he can pull off Florida, Texas and maybe Pennsylvania, he has a chance.
I reiterate my observations in Eastern NY, Western Massachusetts and N Central Connecticut. HRC has such a poor ground game, that you would conclude Trump is running unopposed. Voter displeasure is so great that voters have displayed more signs for local/state candidates than for POTUS. One sign even said, “Giant Meteorite for President”. Only in Cape Cod do the number of campaign signs for Trump and HRC appear equal.
And I reiterate my observations from Ohio, Indiana and Missouri where I travel regularly and extensively for work. 15 Trump signs to every Hillary sign.
Some of the Hillary signs say “Hillary for Prison……….2016”
10 miles n of detroit, Trump yard signs have a life expectancy of 3 days. Clinton signs are almost nonexistent.
Here’s a good one that’ll make everybody forget about Jeff Bezos’ Blog… and remember to pass it around It’s short so most people will actually watch it.
Thanks for posting this. Note the battle ground is the exurbs. Reading is a perfect example. The urban center machines will deliver for her there but the transition region between rural and urban is in flux. I’m impressed at Trump’s perspicacity. Exact opposite of her fading. I’ve noticed over the years the guy who acts like he wants the job most often wins. I suppose it’s because voters feel at least that guy will work at the job. I felt Bush senior was burned out as was Romney.
Jon Sellers said:
“Yahoo Finance reported trailing 12-months Amazon’s P/E at 654. That is before today’s report. Lovely.”
No bubble here folks. Make sure you’re maximizing your 401K contributions and move along…
I have a habit of selling my stocks off when they hit ridiculous PE ratios like 25 or 30. Now you watch CNBC robot people talking that 16:1 is “so old school”. 3000 years of economic experience to draw from and buyers think tulip bulbs are a buy and hold item.
“It’s different this time.”
Yepitis…. you can’t find reality anymore.
Beer Drinker said:
It has been many years, but the last time I looked at Amazon stock to short I didn’t because once you added in the just a portion of the R&D costs back the PE comes back in line real quick and arguably Amazon spends much more than it needs to on R&D. I’m not saying that it is still the case, but always worth looking deeper in to the numbers vs simple ratios.
Having said that, can’t wait for the market to crash. It is beyond crazy.
Jon Sellers said:
I’m an IT guy and Amazon is way out ahead of the competition on cloud services. What Bezos has pulled off there is phenomenal. There is no reason to have on-prem computing anymore. It’s revolutionary, but it will take a while for everyone to figure it out.
There is nothing phenomenal about centralized computing. It was in existence for 20+ years prior to the arrival of the PC. The difference this time is centralization is at a vendor’s site instead of inside a corporation.
Jon Sellers said:
What’s revolutionary is the fail-over capabilities, 7 9’s uptime, ease of application installation and pricing. Doesn’t have much to do with where it’s hosted.
I bought my last round of puts this morning.
LOL! …so did I.
No way I could have ever invested in gambling.
Chris Yang said:
Business has slowed down dramatically Mish. I work in an area where I can see purchase orders coming in and this month alone the number of orders is simply pathetic (and we’re talking about stores stocking up for the holidays this month).
Don’t be surprised if both Target and Walmart miss their guidance.
Netflix is on serious cash burn currently.
Their programming is sucking as of late.
FB…not sure what they bring other than this is
what I’m doing at the game or event BS. Come
On everybody click the like button.
P/e nose bleed Amazon.
Apple has changed into the Wal mart of computers.
What is really new here? Better phone camera?
Sierra is shat. After up grading my audio recording
Apps won’t work. Thx Apple. And FU
I have lost money shorting AMZN, but did make some shorting NFLX and TSLA in Jan this year. Don’t do it until SPY rolls over on weekly charts, though. Another high PE stock stock that usually defies gravity is Salesforce.
Maybe an idea to build a short position in QQQ’s. The Nasdaq dropped to 1200 in 2008/09.
It’s 5200 right now.
When the tech group falls, it will fall hard and it will fall fast. Remember 2000/02 and 08/09.
Because of its massive advertising budget and other ties to the company, the media often seems to be in bed with Amazon. This means you seldom hear anything bad about the retail behemoth and stories are always being put before us as free advertising.
You can count on the media to never tell the truth or the whole truth and anything but the truth. The article below contains fifteen things Amazon is not in a hurry to tell you. I tried to stop at ten but found it impossible.
If you take all the dividends ever paid by the “FANG’s and add them together, you will come up with a grand total of ZERO. Not one penny paid out, E-V-E-R.
Anyone that loses their shirt “investing” in these stocks, deserves it.