essays pieces of the puzzle
Thursday, December 27th, 2012
the four horsemen

12 1228 zAAPL zGOOG zFB zAMZN

Wednesday’s Wall Street Journal had an article titled “Apple vs. Google vs. Facebook vs. Amazon,” about the battle among the four firms, which “is set to escalate around two fronts:  hardware and search.”

The top panel in the chart shows the performance of the stocks since the debut of Facebook (FB).  At bottom is the change in earnings estimates for the next four quarters as calculated by Bloomberg.  (The numbers are “adjusted” earnings, the compilation for each firm as chosen by analysts and reported by Bloomberg and other data vendors.)

The most striking aspect of the chart — other than the well-known decline in FB since its IPO — is the fact that all of the firms have seen estimates go down markedly in the last seven months.  The biggest drop by far was at Amazon (AMZN), although it tied Google (GOOG) for the best performance during the period.  (For a look at AMZN’s “unadjusted” historical results, you can see this posting.)

As for Apple (APPL), as mentioned recently, I was surprised at the lack of traffic at the Apple store on my annual shopping trip.  I had to make a supplemental trip to another mall three days later and that store also was noticeably less busy than it has been previously.  We’ll see if those visits were anomalies when the numbers come out.

As the battle between these four horsemen intensifies, which one will win in terms of revenues?  Of profits?  Of stock performance?  How will the group do as a whole versus other parts of the market?  (Chart:  Bloomberg terminal.)