Seeking Alpha

Risk off? High-flying U.S., Chinese Internet stocks get hammered

  • With the government shutdown having reached day 8, many U.S. and Chinese Internet stocks that have seen giant 2013 gains (often with the help of momentum traders and/or short squeezes) are falling sharply.
  • U.S. decliners include Facebook (FB -5.2%), Yahoo (YHOO -5.2%), Netflix (NFLX -4.7%), LinkedIn (LNKD -7%), Zillow (Z -5.3%), Trulia (TRLA -7.5%), Yelp (YELP -9.3%), Groupon (GRPN -4.9%), and Web.com (WWWW -10.2%).
  • Chinese decliners include Baidu (BIDU -6.2%), Sina (SINA -7.5%), YY (YY -7.3%), Sohu (SOHU -5.1%), Renren (RENN -9.2%), Youku (YOKU -9.6%), Vipshop (VIPS -6.9%), and Dangdang (DANG -10.7%).
  • A chart of the YTD performance of some key names speaks for itself.
Comments (32)
  • Gary Jakacky
    , contributor
    Comments (2361) | Send Message
     
    Right...as Homer Simpson would say, "D'OH"! Stocks in the US are off because we WON'T PAY our debts...and the country with massive surpluses are selling off because, um, they COULD?
    8 Oct 2013, 12:06 PM Reply Like
  • berniespear
    , contributor
    Comments (220) | Send Message
     
    finally!
    8 Oct 2013, 12:10 PM Reply Like
  • Water Brothers Financial Co...
    , contributor
    Comments (307) | Send Message
     
    exactly - and more to come, as Icahn will now sell NFLX.
    8 Oct 2013, 12:19 PM Reply Like
  • vandeley
    , contributor
    Comments (105) | Send Message
     
    I think he has already sold via call options he has written.
    8 Oct 2013, 01:32 PM Reply Like
  • Jasper85
    , contributor
    Comments (301) | Send Message
     
    Holy crap, that's what I call a red table.
    8 Oct 2013, 12:55 PM Reply Like
  • Mario46
    , contributor
    Comments (3) | Send Message
     
    I am asking for suggestions that we can do as constituents of these arrogant buffoons in Congress to make them listen and act. My emails are responded to with mealy-mouth platitudes telling me how great they are. We, average Americans with minimal investments, are suffering because of their arrogance. Our president is not a leader nor is Congress acting for the good of our country. This nonsense must stop! Any suggestions?
    8 Oct 2013, 01:13 PM Reply Like
  • Doug Deeper
    , contributor
    Comments (4) | Send Message
     
    Try writing Obama. Congress at least understands the wisdom of free enterprise. Obama hasn't a clue. He changes his own law to allow DC politicians to get their own health care, and business to avoid it also, and labor unions are clamoring for their own exemption, But he doesn't allow congress, who is responsible for passing and changing legislation, to act to make changes. It is called Obamacare for a reason, only he can legislate and execute the law. I am not sure he sees a need for a congress any longer. He is a "constitutional prof" who hates the constitution.
    8 Oct 2013, 03:51 PM Reply Like
  • richernow
    , contributor
    Comments (45) | Send Message
     
    " You can fix boobs, you can fix bad noses but
    THERE'S NO FIxING STUPID!" -- Comedian Ron White
    Sadly this country is roughly 50% ignorant, fear-mongering, moronic, STUPID Republicans.... and they have the nerve and unmitigated gall to claim they are Americans. They are no part of my America...
    8 Oct 2013, 09:52 PM Reply Like
  • richernow
    , contributor
    Comments (45) | Send Message
     
    Doug, You've got to be kidding! How dare you spout your GOP lies and rhetoric here. You stupid republicans need to take your losers' sour grapes and stuff em!. "Affordable Health Care" was past in congress, supreme court and signed into LAW years ago. Who the hell do you people think you are exhorting Americans the way you are doing --trying to deny health care for the unfortunate uninsured. You are all a bunch of cold blooded terrorists. Holding the rest of us hostage. Obama has more then "a clue". HIs plan is a much needed God send for the hundreds of thousands of people over loading the signup web sites with the REAL popular demand. Americans, contrary to Boners lies, DO in fact want it. If anyone "hates the constitution" It YOU BITTER GOP NATZIS. Let the hostages go!
    8 Oct 2013, 10:14 PM Reply Like
  • gwynfryn
    , contributor
    Comments (3810) | Send Message
     
    Right! These ideologists are so funny aren't they? Unfortunately, just as civilisations protect their defectives, we have something called democracy that not only protects the prejudiced clueless, it even allows them to chose who runs the country! Old Winston had it the wrong way around; it may well be "better than all those others" (at least, those that have been tried to date, apart from the exceedingly rare benign dictatorship) but when you get down to it, it's still "an awful system of government"...
    9 Oct 2013, 05:34 AM Reply Like
  • ReligiousWacko
    , contributor
    Comments (672) | Send Message
     
    totally agree richer. I used to mostly support Republicans and still consider myself fiscal conservative but now despise current GOP. It's dominated by religious lunatics that champion ignorance. Instead of reasonable debate, there are only conspiracy theories and economic terror threats.

     

    I wish Huntsman or Christie would lead a breakaway party and dump the tea bag lunatics.
    9 Oct 2013, 06:31 AM Reply Like
  • Mario46
    , contributor
    Comments (3) | Send Message
     
    Wow! What a vitriolic response to a reasonable question in which I asked: How do we solve this problem"? Even if you don't accept the Tea Party beliefs (which I don't) they are Americans and apparently are strong enough to send their representatives to Congress. The president must get involved and used his power because he is the elected leader of our country. His TV outbursts don't help the situation. The Dems know the GOP is wrong - and the Repubs know the Dems are spending us into bankruptcy. While they blabber we, investors, are getting hurt. How about some positive suggestions?
    9 Oct 2013, 11:52 AM Reply Like
  • Sam Johnston1
    , contributor
    Comments (495) | Send Message
     
    How convenient of Seeking Alpha on a day the whole market is taking a hit.
    8 Oct 2013, 01:28 PM Reply Like
  • Sam Johnston1
    , contributor
    Comments (495) | Send Message
     
    The closer we get to default the more the stocks will dramatically fall. We'll have more days like this but this is just a game. Congress is in bed with many of the large institutions. They will be the first to get a heads up for good news or bad news.
    8 Oct 2013, 01:31 PM Reply Like
  • gwynfryn
    , contributor
    Comments (3810) | Send Message
     
    Yes Sam, the rich and powerful will protect their own kind, come what may.
    9 Oct 2013, 05:35 AM Reply Like
  • Cliff Hilton
    , contributor
    Comments (1278) | Send Message
     
    @Sam Johnston1,

     

    You sir a accusing the Congress of the ability to contrive such a thing. I don't think they have such an original thought among them. Bumbling and indecision are more like it.
    8 Oct 2013, 02:42 PM Reply Like
  • gwynfryn
    , contributor
    Comments (3810) | Send Message
     
    Oh no Cliff; ideology does not allow for indecision; they already know what is "right" (regardless of evidence to the contrary) and that is the nub of the problem...
    9 Oct 2013, 05:37 AM Reply Like
  • Tricky
    , contributor
    Comments (1569) | Send Message
     
    But... we were assured by self-described "pro business" Congress members that default would be no big deal?
    8 Oct 2013, 02:42 PM Reply Like
  • gwynfryn
    , contributor
    Comments (3810) | Send Message
     
    They also used to claim that "Reagan has proved that deficit spending doesn't matter", and kept on doing so, even after he had to institute record tax raises to get the US out of the hole that "supply side" economics caused. Then Dubbya, having inherited a balanced budget from that "high tax" fiend Clinton, tried it again, and here we are! Of course, it can only be Obama's fault...
    9 Oct 2013, 05:42 AM Reply Like
  • glbcpa1@bellsouth.net
    , contributor
    Comments (10) | Send Message
     
    If you think market is going down buy insurance: SDS and TZA etc.
    8 Oct 2013, 03:46 PM Reply Like
  • gwynfryn
    , contributor
    Comments (3810) | Send Message
     
    And puts.
    9 Oct 2013, 05:42 AM Reply Like
  • Patent News
    , contributor
    Comments (1272) | Send Message
     
    left out from the list is a typica bubble tech stock: Tesla!

     

    http://seekingalpha.co...
    8 Oct 2013, 07:38 PM Reply Like
  • CDM Capital
    , contributor
    Comments (419) | Send Message
     
    Don't forget the sister company SolarCity ($SCTY), which in our opinion is even more of a bubble w/ no competitive barriers to entry and absolutely no proprietary product. 24x sales & 17x book value
    9 Oct 2013, 12:00 AM Reply Like
  • khepp
    , contributor
    Comments (15) | Send Message
     
    FB earnings will be out and it will pick up to what it lost. The govt. will get a deal and all will go up again. If u r long term there is no concern.
    8 Oct 2013, 08:49 PM Reply Like
  • PeterPatersonSenior
    , contributor
    Comments (96) | Send Message
     
    That what I believe in also. In long term we are all dead. But hopefully the stocks will go up before that.
    8 Oct 2013, 10:14 PM Reply Like
  • Jasper85
    , contributor
    Comments (301) | Send Message
     
    In long term we are all dead?
    The Fed nor the Congress/President will let the default happen, risking a new crisis.
    The world is following the US economy, cause they depend on them.

     

    Market will restore some of it losses, the announcement of Janet Yellen doesnt seems like coincidence to me.
    9 Oct 2013, 04:40 AM Reply Like
  • stoj
    , contributor
    Comments (231) | Send Message
     
    it's not congress fault, that many of these stocks have rallied 150% this year, hahaha
    9 Oct 2013, 03:31 AM Reply Like
  • gwynfryn
    , contributor
    Comments (3810) | Send Message
     
    I must concede that they are not wholly responsible for Wall Street's own version of QE.
    9 Oct 2013, 05:45 AM Reply Like
  • jeffycat
    , contributor
    Comment (1) | Send Message
     
    What is the relationship between gov shutdown and internet stocks? Does their mutual effects make sense?
    11 Oct 2013, 08:08 AM Reply Like
  • gwynfryn
    , contributor
    Comments (3810) | Send Message
     
    Not to me, jef, but the big players see relevance in all sorts of economic news, and one direct effect of the shut down is that there is very little of that being published at present. They can't seem to do nothing and just wait it out though (as would seem sensible?) so they react instead to every rumour they note, hence the silly volatility.
    11 Oct 2013, 08:23 AM Reply Like
  • Vegas Ben
    , contributor
    Comments (216) | Send Message
     
    The momentum stocks are tied heavily to the government shutdown, because in order to give these companies the incredibly high valuations that they have, they have to have huge year-over-year growth. If the economy goes into a recession, even a minor recession, the momentum stocks might go from huge YoY growth to very little or no YoY growth. Basically, the stock price could drop so quickly that they could go from a P/E of 700 to a P/E of 20 within a very small period of time.
    11 Oct 2013, 02:02 PM Reply Like
  • gwynfryn
    , contributor
    Comments (3810) | Send Message
     
    Which in many ways, could be a good thing, VB!
    12 Oct 2013, 09:27 AM Reply Like
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