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George Acs

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  • Facebook Before Earnings [View article]
    It sure is.
    Oct 30, 2013. 08:29 PM | Likes Like |Link to Comment
  • Facebook Before Earnings [View article]
    Well, it appears that FB has closed the after hours session at $48.99, off two cents from the closing bell price of $49.01

    I guess everyone was wrong. Earnings made no impact on price.
    Oct 30, 2013. 08:01 PM | Likes Like |Link to Comment
  • Facebook Before Earnings [View article]
    That's a pretty credible thesis. I wouldn't discount him as a leading indicator.

    I think that Carl Icahn has also irrevocably changed Apple (Carl Icahn Spells an End to an Era at Apple )
    Oct 30, 2013. 06:52 PM | Likes Like |Link to Comment
  • Facebook Before Earnings [View article]
    Actually, what you're witnessing has been a theme for about the past 6 months and has extended well beyond high momentum stocks. Facebook is just a possible example of a phenomenon that owes to placing greater emphasis on future guidance than on past earnings.
    While I have (incorrectly) believed that the market has been over-extended since April 2013, the reactions and specifically the reversals in after hours trading may be reflective of something altogether different from the belief that the market or an individual class of stocks requires a rest (although I can't diagree with the sentiment.)

    The theme is that guidance is playing a far more important role than ever before. Sharp reversals after the numbers are released, even when there has been plenty of time to digest the intricacies of the balance sheets are becoming commonplace.
    In Facebook's case the reversal was due to what was perceived as a threat to ad income from increasingly disengaged adolescents. That concern plays right into the perception that was making the rounds earlier this week that some advertisers were not feeling they were getting value for their ad dollars.
    In Facebook's case a decrease in revenue could be offset on the expense side of the ledger at some point, but not likely in time for the next quarter. The real concern in Facebook's case is that there is a threat to the rate of ad growth revenues.
    For Facebook, the primary strategy to optimize earnings is through increasing revenues.
    However, for many companies that expense side of the ledger has become the primary strategy as revenues have disappointed.
    As earnings are increasing labile and less dependent on revenues as they have become more so on operating expenses, there is a limit to how much you can maintain earnings. In a quarter where 70% of the companies thus far reporting earnings have beaten expectations, but have done so on lower earnings, there is lots of suspicion regarding the ability to do it again next quarter. The question becomes "where are you going to make the cuts this time?"
    Any suggestion of dour guidance has resulted in very swift and decisive reversals of fortune in the after-hours. No one has been immune.
    Oct 30, 2013. 06:29 PM | Likes Like |Link to Comment
  • Facebook Before Earnings [View article]
    Thank you.

    I also get superstitious about "jinxing" myself. It turns out that it's more likely guidance that turns the tide after earnings are released and not some evil spirit, but I still don't take any chances.

    I've always been intrigued by people that can keep various complex option strategies straight. I think that if I had started trying to understand the strategies 20 years ago I wouldn't be dumbstruck as I am these days.

    Glad the trade is working out for you.

    A few years ago after some frustration trying to set up a MySql database, I decided to do the unthinkable and actually read about how to do it. After a few chapters I realized that my brain was no longer capable of certain kinds of processes. These days that includes strangles, condors and other flying critters.

    I used to dread earnings season, but stocks like Facebook (and AAPL, GOOG and many others) make for good opportunities even for conservative investors, like me, who aren't keen on taking on risk. Even though it may seem paradoxical that someone who aggressively trades a covered option portfolio could welcome earnings, the option market can be the best friend of anyone seeking to define risk and create profit streams.

    In the meantime, I hope you get out of the trades and use those profits wisely or frivolously, which ever is more situationally appropriate
    Oct 30, 2013. 05:33 PM | Likes Like |Link to Comment
  • Facebook Before Earnings [View article]
    Where exactly did I say or claim that I had "new worthy news on why it (Facebook) should go down"

    In re-reading your several comments it's not very clear that you are commenting on anything other than thoughts swirling in your head, none of which appear to have in connection to this article, nor to any of my comments in response to readers.

    It must be stressful to have reality compete for your attention
    Oct 30, 2013. 05:03 PM | 1 Like Like |Link to Comment
  • Facebook Before Earnings [View article]
    I thought he was referring to the very first post, which didn't seem offensive to me, at all, but we can both keep looking.
    Oct 30, 2013. 04:51 PM | Likes Like |Link to Comment
  • Facebook Before Earnings [View article]
    I think you greatly missed the point.

    I'm not quite certain where you found me quoting "no advertising growth" and "revenue never beats." I think you may be suffering from some kind of delirium or simply inability to comprehend the written word.

    I sold puts on Facebook and am happy to see the price trade above the strike. The whole point was to find a mechanism to make money off of the earnings report within defined risk tolerances as defined by implied price moves.

    But, for what it's worth, I haven't heard the word chump since the 1960s. Nice memories.
    Oct 30, 2013. 04:30 PM | 1 Like Like |Link to Comment
  • Facebook Before Earnings [View article]
    Good luck. Strangles and straddles are far too complicated for me. I simply went with the put sale
    Oct 30, 2013. 04:17 PM | Likes Like |Link to Comment
  • Facebook Before Earnings [View article]
    Cogent, reasoned and possessing the one phrase that i look for in every comment or article, but is almost always sadly lacking:

    "Freakishly awesome."

    Although truth be told, you had me at "vaporous social media flirt."
    Oct 30, 2013. 01:23 PM | 2 Likes Like |Link to Comment
  • Facebook Before Earnings [View article]
    Just noticed. Thanks, but if anything is missing you know the first door I'll be knocking on is yours.
    Oct 30, 2013. 11:58 AM | 1 Like Like |Link to Comment
  • Facebook Before Earnings [View article]
    I use bid prices, although with liquid contracts the differential shouldn't be terribly high and should not have a meaningful effect, neither on calculated values nor their interpretation.
    Oct 30, 2013. 10:49 AM | Likes Like |Link to Comment
  • Facebook Before Earnings [View article]
    I wrote a few articles beginning about May 2012 that were cautionary on Apple. Back in December 2012, when shares were at $525 the belief that the next stop was $100 lower wasn't well received.

    The animus in the comments was later mirrored in the positive pieces I wrote about Facebook starting in August 2012.

    While I don't agree with your earlier price target, I do agree that a strong sense of opinion, sometimes based on emotion, is not a healthy thing if widespread. I would tend to want to head in the opposite direction.

    As far as Facebook goes, my interest is only over the next 2 1/2 trading days. I take my opinion one option sale at a time.
    Oct 30, 2013. 10:21 AM | 1 Like Like |Link to Comment
  • Facebook Before Earnings [View article]
    And how will that impact earnings reported this afternoon?
    Oct 30, 2013. 08:32 AM | Likes Like |Link to Comment
  • Facebook Before Earnings [View article]
    I don't believe that I implied that I was a bored academic. That is what one might call a projection, but it is in line with your other projections.

    I wasn't predicting the market. I'm not quite certain how you drew that conclusion. WHat I was suggesting is that there is a trade in Facebook based upon what the option market is telling us. In fact, the position is completely agnostic. I could care less for this specific trade whether Facebook goes up or down. My preference is that it moves higher, but if it goes lower, I would like to see it stay within the strike price that returns 1% for the 3 day investment.

    Now, as far as your other issues, they are all extraneous, at least with regard to the topic of this article.

    Suggesting that Facebook out to be able to find a way to monetize a billion people isn't likely to be an issue with earnings this week and any price movement that may ensue.

    The article is limited to 3 days in the life of Facebook and not a projection of the rest of its corporate life or strategies.
    Oct 30, 2013. 08:31 AM | 1 Like Like |Link to Comment