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2 FAANG “Strong Buy” stocks to watch for profits
Big Tech has been in the news lately, and not necessarily for the right reasons. Charges of corporate censorship have been in the headlines in recent weeks. While serious, it can have a salutary effect – the public debate about the role of Big Techs in our digital lives is long overdue. And that discussion will begin just as the fourth quarter and full year 2020 financial numbers begin to arrive. Among FAANG shares, Netflix has previously reported; the other four will publish the results within the next two weeks. So the earnings ahead will get some well-deserved attention, and top Wall Street analysts are already publishing their views on some of the market’s most important components. Using TipRanks’ database, we pulled details from two FAANG club members to find out how the street thinks each will behave when they release their fourth quarter numbers. According to the platform, the two received a lot of love from analysts, earning a “Strong Buy” consensus rating. Facebook (FB) Let’s start with Facebook, the social media giant that has redefined our interactions online. Along with Google, Facebook has also brought us targeted digital marketing and advertising, as well as mass internet monetization. It has been a profitable strategy for the company. Facebook’s market capitalization stands at $ 786 billion, and in the third quarter of 2020 the company reported $ 21.5 billion on the top line. Looking ahead to the fourth quarter report, due Jan. 27, analysts are forecasting revenue of $ 26.2 billion or so. This would be in line with the company’s model of increasing quarterly performance from Q1 to Q4. At the projected sum, revenues would increase 24% year-over-year, roughly matching the 22% year-over-year gain seen in the third quarter. The key metric to watch will be the growth in the number of daily active users; this metric slipped slightly from Q2 to Q3, and a further decline will be seen as a worrying sign for the company’s future. As it stands, the average daily Facebook user count is 1.82 billion. Ahead of print, Oppenheimer analyst Jason Helfstein increased his price target to $ 345 (from $ 300), while reiterating an outperformance (i.e. buy) rating. Investors are expected to pocket a gain of around 26% if the analyst’s thesis comes to fruition. (To see Helfstein’s track record, click here) The 5-star analyst commented: “[We] expect fourth quarter ad revenue to easily exceed Street’s estimates. We now expect 4Q ad revenue + 30% y / y compared to Street’s + 25% estimate based on a regression of US Standard Media index data (r-squared 0.95) and an acceleration of Global CPM data from Gupta Media (4Q + 35% y / y vs. 3Q -12%). Additionally, we are very optimistic about FB’s ecommerce opportunity following conversations with our checks and our initial work of conservatively estimating Shops is a $ 25- $ 50bn opportunity versus $ 85bn. current tours. We believe stocks that are currently trading at 7.1x EV / NTM sales offer the most favorable risk / reward in internet large caps. Overall, the social media empire remains a Wall Street darling, as TipRanks analyzes present FB as a strong buy. Out of 34 recent reviews, which break down into 30 buy notes, 3 takes and 1 sell The shares are valued at $ 276.10 and the average price target of $ 327.42 suggests a year-on-year rise of around 19% (see FB share analysis on TipRanks) Amazon (AMZN) In when it comes to e-commerce, we can’t avoid Amazon. The retail giant has a market capitalization of $ 1.65 trillion, making it one of four publicly traded companies valued at over trillion dollars. Its famous price tag is notoriously high, and has increased by 74% since this time of last year, far surpassing the broader markets. Amazon’s growth has been supported by an online retail business increased during the corona year Globally, online retailing grew by 27 % in 2020, while total retail trade fell 3%. Amazon, which dominates the online retail industry, is expected to end 2020 with $ 380 billion in total revenue, up 34% year-on-year, overtaking global e-commerce wins. TipRanks-rated 5-star Cowen analyst John Blackledge is covering Amazon and is optimistic about the company’s outlook ahead of the results release. Blackledge is pricing the stock outperformed (i.e. buy) and its price target at $ 4,350, indicates confidence in a 31% rise over the one year horizon. (To see Blackledge’s balance sheet, click here) “We forecast sales of $ 120.8 billion in 4Q20, + 38.2% y / y vs. + 37.4% y / y in 3Q20 led by AWS, Advertising, Subscriptions, and 3P Sales [..] We estimate that US Prime submarine growth accelerated in 4Q20 (reaching 76 million subscribers in December 2020 and ~ 74 million on average in 4Q20), aided by pandemic demand, Prime Day in October and a period extended purchase, as well as 1-day delivery […] In 21, we expect the strong revenue growth to continue through e-commerce (aided by COVID in the grocery industry), for example, AWS and its sub-companies, ”Blackledge said. . It’s no secret that Wall Street is generally bullish on Amazon; the company has 33 saved reviews, 32 of which are purchases, versus 1 expectation. The shares are priced at $ 3,301.26 and the average price target of $ 3,826 implies that it will rise another 16% this year (see AMZN stock market analysis on TipRanks) stocks at attractive valuations, visit the best stocks to buy from TipRanks, a newly launched tool that brings together all the information about TipRanks stocks. Disclaimer: The opinions expressed in this article are solely those of the featured analysts. The content is intended to be used for informational purposes only, it is very important to do your own analysis before making any investment.
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