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November sales pushed FAANG's popular shares well below their average price targets on Wall Street.
Chad Morganlander, a portfolio manager at Washington Crossing Advisors, said the fundamentals of FAANG securities remained strong, but that was not enough for him to be optimistic for the group.
"The fundamental context of these companies is strong enough for 2019. Unfortunately, however, I think valuations matter and some of these names would elude us," Morganlander told Trading Nation Wednesday.
Netflix is the most expensive action by valuation. It trades at 102 times its futures profits, while Amazon, the second most expensive, is trading at a multiple of 94.
"We prefer the value of large caps to the growth of large caps for the moment, so we should overweight the Oracles, Ciscos of the world, and even consider Microsoft as a more interesting alternative than the actions of FAANG," he added.
Cisco, Oracle, and Microsoft have also been under pressure in the past three months, but have suffered a fraction of the damage to FAANG's inventory.
Disclosure: Washington Crossing Advisors has positions in Oracle, Cisco and Microsoft.
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