Facebook has been on fire lately with its stock price appreciating 200% over the last 9 months. Of course, Facebook is not alone. Tesla, Google and many other highly speculative issues are up big time since this credit driven stock market rally made a push for its blow off top a year ago.
With that said, Facebook is going out on a limb of stupidity with it’s ridiculously overpriced purchase of WhatsApp two weeks ago and now an apparent purchase of drone maker Titan Aerospace for $60 million. Something tells me that Titan doesn’t have any revenue either, but that’s beside the point.
The issue here is as follows. Mark Zuckerberg doesn’t know what to do with all of his cash. It’s burning a hole in his pocket and he is making idiotic decisions reminiscent of the tech bubble. While Facebook’s stock is still technically strong, there is no doubt that these stupid capital allocations will catch up to Facebook sooner rather than later.Once the market begins to breakdown as per my FORECAST I would anticipate Facebook to come down significantly.
Making Facebook a great short opportunity. (Not yet, wait for a technical breakdown)
Facebook will buy drone maker Titan Aerospace for about $60 million, a source familiar with the situation told CNBC on Tuesday.
The solar-powered drones can reportedly be airborne for up to five years without having to land.
The deal is part of Facebook’s ambition to provide Internet access worldwide. News of a possible deal was first reported by TechCrunch.
Last summer, Mark Zuckerberg announced a project called Internet.org—a partnership with a number of other tech giants that aims to make Internet available to everyone in the world. The solar-powered drones could help Facebook provide Internet to areas around the world without it, starting with Africa.
Titan Aerospace is privately held, and is based in New Mexico. The news comes after the social network acquired messaging app WhatsApp for $19 billion last month.
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