by Tyler Durden at ZeroHedge
Facebook – or Meta now that it’s in the witness protection program – is making record after dismal record this morning after its catastrophic earnings and guidance last night: not only is the company’s 22% drop the biggest in its history…
… but according to Bloomberg, the one-day crash ranks as the worst in stock-market history: the Facebook crash has erased some $195 billion of its market cap. That would make it the biggest collapse in market value for any U.S. company.
The decline on context: the 20% decline in Meta would be more than the market value of 452 of the S&P 500’s members. And since Meta has a 2% weight in the S&P 500, the decline alone with contribute 0.44%-point negative impact on S&P 500.
The sheer size of Facebook’s collapse illustrates just how tech companies have ballooned in size to become behemoths with unprecedented market power, and the drama that can ensue when they stumble.
It’s not the first time Meta shares have dropped dramatically: the stock plunged an almost identical 19% in July 2018 on a slowdown in user growth, translating to a about $120 billion decline in market capitalization. At the time, it set the record for the largest-ever loss of value in one day for a U.S. traded company.
Of course with a market as illiquid and jittery as this one, there’s no certainty the losses will hold, especially given the recent volatility that’s whipped across technology shares. It makes sense to wait until the close as a furious army of buy-the-dippers has stormed stocks in during the final hours of the trading day.
Analysts — most of whom rated the stock a buy as recently as yesterday…
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