Meta, the parent company of Facebook, is having a very bad day.
CNBC:
Sixteen months after Facebook crossed $1 trillion in market cap, joining an exclusive club consisting of Apple, Microsoft, Alphabet and Amazon, its parent company Meta is worth less than Home Depot and barely more than Pfizer and Coca-Cola.
Far from Facebook’s Big Tech days, Meta is no longer among the 20 most valuable U.S. companies after the stock sank 23% on Thursday. The company has shed 70% of its value this year and 74% since the stock peaked in September 2021, totaling over $730 billion in market cap lost. It’s trading at its lowest since early 2016, when Barack Obama was still president.
There’s a bill called the American Innovation and Choice Online Act, introduced by Senator Amy Klobuchar (D., Minn.), which was designed to target Big Tech companies by stipulating that it applies to publicly traded companies with market caps over $550 billion and over 50 million monthly users in the U.S.
Meta’s market cap is now around $270 billion. It would no longer be subject to this bill that lawmakers designed to target it.
Tom Hebert called it for Capital Matters back in February. He warned:
Given how wildly market cap fluctuates, it is foolish to write laws based on this Wall Street-driven metric. The phrase “market capitalization” appears in a grand total of five federal statutes, none of which restrict routine business opportunity based on this paper valuation. . . .
As lawmakers continue to address the myriad issues with current antitrust proposals, legislating by market cap should be the first thing off the table. Doing so makes little sense for consumers and opens the door for further crony capitalism and corporate welfare.
Amy Klobuchar now has a bill intended to punish Facebook that no longer applies to Facebook. Conditions change quickly in a competitive economy, and Meta’s stock-price collapse shows that it isn’t as invincible as some think.