X Marks The Spot: Elon Musk's Ownership Triggers Dramatic Valuation Plunge
Portfolio Pulse from Surbhi Jain
Fidelity's Blue Chip Growth Fund has marked down the valuation of X, formerly Twitter, to $5.3 million, a significant drop from its pre-Elon Musk takeover valuation of $19.66 million. Since Musk's acquisition, the valuation has potentially decreased by 72%, with the current valuation around $12.3 billion, less than the $13 billion debt incurred for the purchase. Major advertisers like Disney, Apple, and Coca-Cola have pulled advertising, impacting X's financial stability. In contrast, Meta and Snap have seen stock increases in November.
January 25, 2024 | 6:14 pm
News sentiment analysis
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POSITIVE IMPACT
Meta Platforms Inc.'s stock rose by 4.9% in November, contrasting with X's valuation drop, indicating a competitive advantage in the social media market.
Meta's stock increase in November suggests a competitive edge over X, which could attract investors looking for stability in the social media industry.
CONFIDENCE 80
IMPORTANCE 60
RELEVANCE 50
POSITIVE IMPACT
Snap Inc.'s shares surged by 38.2% in November, showcasing strong performance in the social media space compared to X's valuation challenges.
Snap's significant stock surge in November could draw investor interest away from X, as it demonstrates growth and resilience in the sector.
CONFIDENCE 80
IMPORTANCE 60
RELEVANCE 50
NEUTRAL IMPACT
Apple Inc. withdrew paid advertising from X, which could influence its public relations strategy and potentially impact its brand perception.
Apple's advertising withdrawal from X is a move that aligns with its brand values, but it's not expected to have a significant short-term impact on AAPL's stock.
CONFIDENCE 80
IMPORTANCE 40
RELEVANCE 30
NEUTRAL IMPACT
Disney pulled advertising from X following Musk's endorsement of an antisemitic post, potentially affecting its public image and stance on corporate responsibility.
Disney's decision to withdraw advertising from X may reflect its corporate responsibility values but is unlikely to have a significant short-term impact on its stock price.
CONFIDENCE 80
IMPORTANCE 40
RELEVANCE 30
NEUTRAL IMPACT
Coca-Cola Co. has stopped advertising on X in response to Musk's actions, which could affect its marketing strategy and consumer relations.
Coca-Cola's decision to halt advertising on X may be part of its ethical marketing strategy, but it is unlikely to have a direct short-term impact on KO's stock price.
CONFIDENCE 80
IMPORTANCE 40
RELEVANCE 30