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Comment by green-eclipse | Hacker News Reader

Wall Street rewarded Meta with a massive jump in share price (+15% in one day) when Zuck stated on an earnings call that he was all now about efficiency (and therefore a tacit admission that he won't just throw the entire company off the VR cliff into the abyss).

Zuck probably thinks more of the same will buy additional good will from Wall St.

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And don't forget that Meta just did a massive stock buyback, so this isn't just about investors out there in the world, this is about Meta itself.

I've started to pay a bit more attention and noticed that there do seem to be a fair number of major investors buying up more shares of a down company before layoffs are announced.

I like to imagine that what we're seeing is a healthy correction and move towards more profitable, sanely run companies. But I can never recall a time in recent years where Wall Street acted in a way I would call "refreshingly sane".

There's no health anything. Interest rates go up, some of this money goes out of the stock market and into other things. When they come back down, the companies will operate in the same way again. Everyone is just responding to financial incentives, nobody is trying to run anything in a "healthy" way, as if there was a margin which the universe defined as healthy.

They know this and could've underhired as this was always a possibility but the game rewards having the pedal to the metal when it's going up, and that's what they will do next time again.

> I've started to pay a bit more attention and noticed that there do seem to be a fair number of major investors buying up more shares of a down company before layoffs are announced.

One other thing I feel I noticed (it's probably not the case but it's one of those things you are just paranoid about) is the stock price peaking around RSU award time. At least they now tend to happen quarterly instead of yearly.

+15% in one day, when the stock is already down 75% from its peak a year or two earlier, doesn't feel like a "massive jump".

Sounds like a band-aid on a gaping wound.

But is it really? Or did a combination of COVID-tech-mania and low interest rates just boost stock prices well above what was actually reasonable?

There definitely has been a sentiment change on meta, but I think 'COVID-tech-mania' is a poor excuse for them failing to effectively diversify.

And yet when they try to diversify to VR people say they should focus on what makes them money...

I suspect the people that said that though thought that VR was a bad place for anyone to throw money. (I happen to agree.)

The differed is Meta’s potential as perceived by the markets has dropped relative to Apple/Microsoft/Google/Amazon. Previously, those 5 were all viewed as having the sky as the limit, but now there are clear differences in expectations.

There is Apple/Microsoft, then Google/Amazon, then a ways down is Meta.

Note that to counteract a 75% drop, you need to grow by +300%.

And 110% in three months and everyone here was too scared to buy Meta stock when it was at $88.

How many here in this thread bought Meta at over $320 in November 2021?

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