timwest
Short

Facebook FB Daily - Will FB follow ZNGA & hit 3 or 6 month low?

NASDAQ:FB   FACEBOOK INC
391 8 6
Very close correlation between these two - but hardly similar in size.

Hard to believe that Zynga             had such a huge valuation at its peak.

If you have time - Check out all of the other FB             charts that I have posted this year.

Tim 62.61 last -0.58

2:15PM EST 6/6/2014
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Algokid PRO
2 years ago
Great find Tim ! Also a great pair if pair trading. looking at the ratio between the two ( based on past 100 days) , the standard deviation is currently at 2.93, very far from the mean.
+2 Reply
NickCoulby PRO
2 years ago
http://pensionpartners.com/blog/?p=360
Reply
2use
2 years ago
Have to disagree on this one. Reason being is that Zynga was purely news and hype based recently. The former Xbox CEO is believed to change the company (yes im taking fundamentals here), and they popped the price on pre-released earnings and with the analyst upgrades it ran recently. But numbers don't change overnight, and they were really brought back. ZNGA has nothing else to move it except numbers and beliefs (in management). If not one, the other is pretty weak as they don't know what will happen - not much in this with Facebook - it is a cult now. It is the game changer, and their plans are future based, while zynga is trying to get their act together and are still losing to King for instance. It is a bet play, basically on their betting games.

Point for the combo is that - Zynga uses FB heavily, and with the success of one, the other was moved as a tail. Now, you need to decide where's the head and where is the tail. For me - znga is the tail.
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DJCYStocks
2 years ago
Thank you for another great chart! I agree with you on this outlook provided the thing that gets me is that 19B deal they recently made I would believe part if not all of it starts hitting the balance sheet on the next ER. Must acquisitions have value from the start and Whatsapp was just in the process of figuring out how to monetize w/ no black on the books. I just don't see this even coming to close to break even in a 5 year outlook and I would expect it to hit this coming ER, which I highly suspect is why Ebersman bowed out and left at the top of his career with FB. Basically, I think that confirms what you are seeing in the charts on setting it up for a potentially large correction this year.
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geppytrading PRO
2 years ago
These companies are so incredibly different I don't know how you can justify even comparing them...
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2use geppytrading
2 years ago
Are you comparing their business and fundamentals? then yes, i agree. if you are comparing their technical valuation vs their income? Check nasdaq.com for the P/Es of both of these. They are all momentum, highly popular and speculated stocks that recently hit the stock market, have a short history of trading and a lot of future earnings priced in. Im not comparing them in terms of business, but they are similar in their momentum.
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geppytrading PRO 2use
2 years ago
Yes, I was referring to them in a biz/fundi perspective. Very, very different.
Reply
2use geppytrading
2 years ago
Well, they are - but once froth is taken, profits are taken and markets shake - these 2, along with other overvalued profit-unkown companies get shaken most and first.
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