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I think it’s usually a much bigger deal for growing tech companies because their stock price is basically a guess about their future growth and so getting lower
by dan-robertson 4y ago
I think it’s usually a much bigger deal for growing tech companies because their stock price is basically a guess about their future growth and so getting lower growth than expected implies a big change to future size/revenue of the company and therefore the stock price. I think the effect is much smaller for established companies that aren’t expecting big changes or growth rates.
- kadoban 4y ago> I think the effect is much smaller for established companies that aren’t expecting big changes or growth rates. Yeah, no big changes happening at Twitter currently. Everything stable and normal.
- dan-robertson 4y agoI think logic of the comment I replied to above was incorrect. The reason that growth numbers have a big effect on stock prices is that they cause big changes to the “company in N years time” posterior distribution. However the comment was suggesting that the numbers are important in the short term and one can tell by analogy to stock markets. But the markets aren’t looking at such an immediate short term so the analogy breaks. One can decide that Twitter is in a good or bad state but I think one should want a strong foundation rather than relying on faulty analogies.
- deleted 4y ago[deleted]