Wild Day in Shares of Facebook as Traders Dissect Whatsapp News

After the close yesterday, Facebook announced the purchase of mobile messaging platform Whatsapp for $19 Billion. The knee-jerk reaction was to send $FB shares down over 2% in after hours trade. And the uncertainty continued when the market opened for trade this morning, sending $FB south of $66.

It seemed investors overreacted a bit, as the stock found a bottom about an hour into the trading day and basically traded one way — up — the rest of the day.

Here are some of the smarter ideas shared on the $FB stream today as investors began to see value in the transaction:

@chicagosean buy the dip. People were saying the same thing about buying Instagram. I'm not listening to the noise!

— JMo (@Watch4Green) Feb. 20 at 08:38 AM

$FB Now 60,000 March 85 calls have traded, the question is are they selling or not, tomorrow OI will tell

— InvestingJungle (@InvestingJungle) Feb. 20 at 11:20 AM

Serious question. What would it take (technically) for $AAPL to make iMessage a cross-platform app? $GOOG $MSFT $FB

— Tadas Viskanta (@abnormalreturns) Feb. 20 at 11:52 AM

they euphorics have clobbered the naysayers in $FB today. to the victor…

— Steven Spencer (@sspencer_smb) Feb. 20 at 11:54 AM

GREAT-looking bounce off the 10-day line for $FB today. As soon as it hit that line, buyers jumped in to buy the dip.

— DarvasTrader.com (@DarvasTrader) Feb. 20 at 12:09 PM

$FB how much is a huge untapped "mine" of data ripe for the picking worth…guess we're finding out

— Art Vanderlay (@ArtVanderlay) Feb. 20 at 12:41 PM

$FB apparently now the market believes $FB stole WhatsApp for a song.

— AskLou (@AskLou) Feb. 20 at 12:43 PM

In terms of behavioural data we have never seen the likes of $FB. Monetisation is limitless both within and outside of fb.com.

— Kate Hiscox (@uhhuhthatkate) Feb. 20 at 12:44 PM

Facebook just spent $19 billion and the market handed them $3B on top of that today…wall street and main street have voted for today! $FB

— Howard Lindzon (@howardlindzon) Feb. 20 at 12:57 PM

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With $FB at $70, the purchase price for #WhatsApp increases to $20.1B

— MicroFundy (@MicroFundy) Feb. 20 at 01:41 PM

$FB 200% volume, all time highs. Higher. http://stks.co/t00uJ

— Hugh (@CoonCatt) Feb. 20 at 01:54 PM


And lastly, I loved this poker perspective dive by Mercenary Jack…

$FB WhatsApp purchase can on some levels be understood via poker tournament strategy. Zuck is well past the bubble, but wants final table.

— Justice “Jack Sparrow” Litle (@MercenaryJack) Feb. 20 at 11:42 AM

Long-run results for $FB are binary, to a degree, in the sense that Facebook either wins all (stays dominant) or loses all (gets replaced)

— Justice “Jack Sparrow” Litle (@MercenaryJack) Feb. 20 at 11:42 AM

From this perspective, 10% of $FB inflated market cap, while a lot, is a prudent bet. For 10% of Zuck's chip stack, he increases odds of win

— Justice “Jack Sparrow” Litle (@MercenaryJack) Feb. 20 at 11:44 AM

So not about "dollar cost per user" so much as ensuring $FB long-run social media dominance. 10% of stack is fair risk/reward from that view

— Justice “Jack Sparrow” Litle (@MercenaryJack) Feb. 20 at 11:45 AM

Not to mention $FB is paying w heavily inflated currency (shares) and getting 450 million users trending toward a billion to monetize later

— Justice “Jack Sparrow” Litle (@MercenaryJack) Feb. 20 at 11:46 AM


Trade ’em well,
~ Sean McLaughlin (@chicagosean)


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