7 ms·

Are rising stock prices always a sign of company health?

edanm 9y ago
Of course not. But they are a sign that professionals, who literally put their money on the line, think the company is getting more valuable.
- freehunter 9y ago
  I'm sure that Perdue Pharma is getting more valuable as the nation's opiod crisis worsens, too.
- mtgx 9y ago
  Facebook may become better at monetizing the remaining users, even as there is an exodus, and overall, it could show increasing profits and revenue. This would "excite investors" but it doesn't mean the company isn't screwed in the long term if things continue the way they are. The other guy joked about Blackberry, because even as the US and Canadian markets were dumping Blackberry, the company continued to see some nice growth overseas, which also led to record sales, profits and so on. But it was obvious Blackberry was fighting against time with the iPhone destroying its core markets. Most investors didn't see it at the time either, because they were just following the "positive quarterly results," much like Blackberry's leadership was.
  - bgirard 9y ago
    > even as there is an exodus Citation?
  - spyspy 9y ago
    If you believe that investors don't look at non-revenue metrics like MAU you are sorely mistaken. In fact, it's almost all they care about in this category. Twitter's stock is in the toilet because their user growth has tapered, whereas Facebook continues to grow at a healthy clip.
- TallGuyShort 9y ago
  If working at a company through and after its IPO period has taught me anything, it's that professionals choosing to put their money on the line or not is not really saying THAT much.
- dfrey 9y ago
  Or maybe just that people are confident that they will find a bigger sucker to sell to.
- gaius 9y ago
  literally put their money on the line It's not their money. It's your pension. They get paid regardless.
jnordwick 9y ago
For the most part, yes. This is basically asking: are increased expected future profits always a sign a company health?
volgo 9y ago
No, but I trust people who put their money where their mouths are, more than random people shouting online with no skin in the game
- 659087 9y ago
  What you're trusting is people who are putting their mouths where their money is, hoping to create more greater fools to keep their investments going.
  - volgo 9y ago
    The stock market has risen for the past century. I think history doesn't agree with your statement.
    - meebs 9y ago
      Yet who captures most of the wealth? :)
nerfhammer 9y ago
You hear a lot of anecdotes about how "nobody uses Facebook anymore" etc for years now, but these stories don't seem to be congruent with the skyrocketing user growth numbers that Facebook officially reports.

Of course not. But they are a sign that professionals, who literally put their money on the line, think the company is getting more valuable.

freehunter 9y ago
I'm sure that Perdue Pharma is getting more valuable as the nation's opiod crisis worsens, too.
mtgx 9y ago
Facebook may become better at monetizing the remaining users, even as there is an exodus, and overall, it could show increasing profits and revenue. This would "excite investors" but it doesn't mean the company isn't screwed in the long term if things continue the way they are. The other guy joked about Blackberry, because even as the US and Canadian markets were dumping Blackberry, the company continued to see some nice growth overseas, which also led to record sales, profits and so on. But it was obvious Blackberry was fighting against time with the iPhone destroying its core markets. Most investors didn't see it at the time either, because they were just following the "positive quarterly results," much like Blackberry's leadership was.
- bgirard 9y ago
  > even as there is an exodus Citation?
- spyspy 9y ago
  If you believe that investors don't look at non-revenue metrics like MAU you are sorely mistaken. In fact, it's almost all they care about in this category. Twitter's stock is in the toilet because their user growth has tapered, whereas Facebook continues to grow at a healthy clip.
TallGuyShort 9y ago
If working at a company through and after its IPO period has taught me anything, it's that professionals choosing to put their money on the line or not is not really saying THAT much.
dfrey 9y ago
Or maybe just that people are confident that they will find a bigger sucker to sell to.
gaius 9y ago
literally put their money on the line It's not their money. It's your pension. They get paid regardless.

jnordwick 9y ago

For the most part, yes. This is basically asking: are increased expected future profits always a sign a company health?

volgo 9y ago

No, but I trust people who put their money where their mouths are, more than random people shouting online with no skin in the game

659087 9y ago
What you're trusting is people who are putting their mouths where their money is, hoping to create more greater fools to keep their investments going.
- volgo 9y ago
  The stock market has risen for the past century. I think history doesn't agree with your statement.
  - meebs 9y ago
    Yet who captures most of the wealth? :)

nerfhammer 9y ago

You hear a lot of anecdotes about how "nobody uses Facebook anymore" etc for years now, but these stories don't seem to be congruent with the skyrocketing user growth numbers that Facebook officially reports.