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After Crashing 20%, Is Facebook Stock a Good Buy Now?

Just last month, I made a trip to the Facebook HQ in Silicon Valley, and I was very impressed by the work culture and vibe of the whole community there. It made me glad to be a shareholder of Facebook, and since then, I have been waiting for an opportunity to buy more of it. 😀

Yesterday, after a disastrous Q2 earnings call, Facebook’s stock has plunged almost 20% so far; is this the start of something really bad, or the long-awaited chance to buy this stock?

 

Personally, I am a big fan of the tech sector, and I have been accumulating positions in the US tech giants since I liquidated all my Singapore stocks portfolio in 2015. but I am not going to jump in blindly, so let me sum up some of the key considerations:

  • The comment that spooked investors was the CFO’s prediction that revenue growth rates would continue to decelerate in the “high single-digit percentages” in Q3 and Q4.
  • While the results were not as fantastic as in the past, the disparity to analysts’ revenue and user growth forecast were not very major.
  • Facebook is likely being extremely conservative and has plenty of opportunities to gain back the momentum.
  • They are constantly innovating and acquiring new companies, some of these might turn out to be big winners
  • Its valuation based on PE is still ok compared to other stocks in the tech sector (about 30x)

 

The last time there was a plunge in FB shares due to the Cambridge Analytica scandal, it dropped almost 10% overnight in March. However, prices recovered very quickly, and before long prices were back to hitting all time highs, bringing valuation close to a $1 trillion market cap.

Some of the key risks could include more regulations that will hurt its bottom line, or anti-trust actions that attempt to split up the company.

But there are also upsides, such as the company leveraging on its technological innovations and data to expand to other industries and eat up the value chain.

So, in conclusion, I will not buy in immediately as I do not want to be catching a falling knife, instead I will wait for selling momentum to wane and the dust to settle before scooping up more of this stock. This is to ensure that I can get in at the best price. After all, I am still optimistic for the long run.

Happy Halloween to All Traders & Investors!

Wishing everyone a Happy Halloween! 😀

Happy Halloween

“Sell in May and go away is an investment strategy for stocks. It includes a theory (sometimes known as the Halloween indicator) that the period from November to April inclusive has significantly stronger growth on average than the other months.” – Wikipedia

Student’s Trade | Bounce Setup – Precision Timing to Catch Turning Points

Congrats on this trade while I was on holiday!

See you all later at today’s monthly LIVE! market workshop! 😀

Student's Trade | Bounce Setup - Precision Timing to Catch Turning Points

Student’s Trade | Bounce Setup – Precision Timing to Catch Turning Points

Student's Trade | Bounce Setup - Strong Rebound the Next Day!

Student’s Trade | Bounce Setup – Strong Rebound the Next Day!

LIVE! Market Outlook Sharing: Global Markets Overview

Later this evening, I will be sharing about the market outlook for indices, stocks, forex and Gold, and I will be explaining these charts in greater detail. See you there!
https://www.eventbrite.sg/e/the-7-best-kept-secrets-of-professional-traders-tickets-11390785145?ref=ecal

BA scan 060514 global markets

^gspc 060514 s&p 500

BA scan 060514 sgx sectors

^sti 060514 straits times index

Portfolio Updates (March 2014) – Swing Trading Bonanza!

Last month was quite an exciting month, with the markets lying quietly for the large part, before exploding upwards towards the end of the month. This could have been due to window dressing, or the seasonality factor. http://synapsetrading.com/2011/06/market-seasonality-and-statistics/

 

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I have taken quite a bit of profits from the recent big moves, and I am now holding in mainly in cash for the next big opportunity, seeing how the STI is nearing one of the major TP zones. The US market, on the other hand, is once again breaking to new highs, and this move could easily continue for the next few weeks.

Near the start of the strong run on the 26th of March, I posted some SCREAMING BUYS in the Synapse Network forum (see below), and all of these have surged up magnificently since the posting.   And I post these updates EVERY SINGLE DAY!

If you want to know which counters we are currently looking at, register quickly for our upcoming Featured Event, and the 1st 30 people will get to join us for an evening of market outlook and strategies discussion. First-come, first-serve!

Check availability: https://www.eventbrite.sg/e/hands-free-trading-strategies-to-break-free-of-the-rat-race-tickets-11094978379?ref=ecal

portfolio updates march 2014

^gspc 030414 S&P500

screenshot 040414 synapse network

^sti 030414 straits times index

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