Why Wall Street loves Apple and Google while Facebook, Zynga and Groupon flail

“Wall Street has soured on social media giant Facebook, online gaming company Zynga, and discount coupon concern Groupon, in favor of two familiar tech stalwarts now reaching new heights,” Sam Gustin writes for TIME Magazine. “Both Apple and Google are at or near all-time highs. Apple set a record Monday as the most valuable public company ever. (Microsoft still wins adjusted for inflation).”

“After years of hype, tech investors are finally fed up with Facebook, Zynga and Groupon. They’re fleeing to the safety of Apple and Google, both of which have proven business models, respected executive teams, and stellar track records of revenue and profit growth,” Gustin writes. “The disastrous stock plunges suffered by Facebook, Zynga and Groupon (down 50%, 70%, and 80% since their IPOs, respectively) have led many investors to a simple conclusion: The recent tech IPO boom was an insider’s game, in which Silicon Valley venture capitalists and Wall Street bankers worked together to inflate pre-IPO valuations, allowing insiders to reap billions in cash, leaving public market investors hanging out to dry.”

Gustin writes, “Apple and Google, by contrast, are two of the most impressive global business stories of the last decade. These companies make incredible products, dominate their respective industries, and mint billions in profits every year… What company savors going head-to-head with Apple in the scaled hardware/design space? What company would be thrilled to try to tackle Google in the web search advertising space? Perhaps most importantly, both of these tech icons are funneling sizable profits back into research and development, laying the groundwork to thrive in the years ahead.”

Read more in the full article here.

[Thanks to MacDailyNews Reader “Fred Mertz” for the heads up.]


  1. From what I can see Zynga just rehashes the same game over and over again. Groupon is only popular with customers when a deal that is too good to be true slips through and then backfires on the company offering it – they then stop using Groupon forever. Facebook (and indeed other social networks) are also now being shown that people don’t want their lives sold off for a buck – at least google has the fallback that if people are searching for something there is a chance that a paid advert might be what they want. Apple make and sell actual products.

  2. Why is Google mentioned in the same breath as Apple? The two are not remotely similar. Google is a one product company – similar to Ashton-Tate with their dbase, which was their downfall. (Google has other products, but 98% of their revenue comes from search. Even in mobile, two thirds of their revenue there comes from iOS!)

  3. The disastrous stock plunges … have led many investors to a simple conclusion: The recent tech IPO boom was an insider’s game

    They’re just now figuring this out? IPOs have been an “insider’s game” pretty much since they were invented!


  4. ??????

    wallstreet loves apple and not facebook?

    why then does FB have forward PE of 45 and Apple 12 (lower ex cash) ?

    Wallstreet seems to HATE apple and only buys it grudgingly — almost as if forced to do so due to apple earnings climbing crazily. They keep apple’s P.E lower than half dead companies on the S&P and value it like no growth utility companies.

    another example of apple hate vs love for other companies can also be seen from Wallstreet buying amazon until it’s P.E is 200+ !!

    wallstreet sells aapl at the drop of vaguest negative news from the stupidest ‘analysts’ on Wallstreet

    if Wallstreet liked (just like not love) aapl should be way over 1000 now.

    (aapl investor, hoping Wallstreet will wake up on aapl and push the price to where it should be… )

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