VSt is the biggest crossover in the history of the world stock market. In just two days, more than 200 billion dollars (about 174.5 billion euros) of capitalization will pass from one pocket, that of Facebook, to another, that of Amazon. This Thursday, February 3, 2022 will go down in history as the day of the most spectacular stock market tumble in history, in terms of amount. All it took was for Meta, Facebook’s parent company, to announce that it was starting to lose followers on its social network and that its revenue would be lower than forecast for the company to drop 25% and see nearly 250 billion. dollars go up in smoke.
Higher wages
A few hours later, Amazon produced the opposite effect with a jump, expected this Friday, February 4, of more than 200 billion dollars in its market capitalization. Its results are higher than expected, its cloud computing division, already the world leader, is up 40% and the firm has had the luxury of announcing an increase of more than 16% in its Amazon Prime subscription. This will increase in the United States from 119 dollars (104 euros) to 139 dollars per year. Reputed to be one of the cheapest on the market, it now reaches the levels of Netflix and most of its competitors. A small contribution to the impressive surge in inflation in the United States.
It is this ability to be able to increase its prices, and therefore its margins, which has delighted the markets. Quite the opposite of Facebook, which had to recognize that the new confidentiality rules imposed by Apple, would make it lose nearly 10 billion dollars. Moreover, neither Amazon nor Google suffered from this decision of the firm at the apple.
Another show of strength from Amazon, its results have suffered neither from the current logistical difficulties, nor from labor shortages in the United States. The firm, whose salaries are notoriously higher than those of the competition, attracts candidates in droves. It hired 140,000 people in the last quarter of 2021 and now employs 1.6 million people worldwide. A unique performance for a company created less than thirty years ago.
Investor Warren Buffett, who has gone through many crises in his career, is wont to repeat that it is when the tide goes out that we see those who were swimming naked. This is the sorting that takes place today in technological stocks. Watch out for those whose valuation is very high compared to their profitability, from Tesla to Uber via Netflix. They have no right to disappoint.