Marked by surging inflation, jumbo-sized interest rate hikes, a darkening outlook on corporate earnings and recession clouds, the S&P 500 Index has lost 21%, on pace for its biggest slump since 2008. From crypto to former pandemic winners and so-called FAANG stocks, investors have been shaken out of their profit euphoria, sometimes in the blink of an eye.
To that can be added regulatory and legal risks, cutbacks from advertisers and a crackdown on targeted ads by Apple. Plus, chief executive officer Mark Zuckerberg’s bet on virtual reality through the metaverse has cost the company billions and isn’t expected to turn a profit anytime soon. And as the largest public U.S. crypto exchange platform, Coinbase has been among the hardest hit as investors yank coins off exchanges or exit the asset class as a whole. This year’s 87% plunge in the stock has wiped out about $47 billion in market value.
Having lost about 98% of its value in 2022, the company is one of the 10 worst performers in the Russell 3000. The difference with the other nine is that it was by far the biggest at the start of the year when its market value stood at about $39 billion. “I think we’ll get an answer on whether Peloton survives in the next year,” said Oppenheimer & Co. analyst Brian Nagel, who has an outperform rating on the stock. “Time is not on their side necessarily.”
After exploding during the pandemic, buy-now-pay-later firms face mounting challenges as rising rates and soaring inflation begin to squeeze household incomes. They’re also facing a high cost of capital and scrutiny over fees. Among payment peers, PayPal Holdings Inc. has fallen 64% this year, while Block Inc. is down 63%.
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