Facebook, Amazon, Google, Netflix, Apple
The FAANGS (or Fang) stocks as they’re called are enjoying another fantastic year in revenues and profits.
The shift to big tech stocks in 2020 and still in 2021 continues as investors seek both high returns and safety in a stock market that isn’t quite safe enough it seems.
The FAANGS (Facebook, Amazon, Apple, Google and Netflix) comprise about a quarter of the S&P 500 and the stock markets go as they go. Amazon offers its ecommerce and cloud dominance, Facebook it’s social media and advertising power, and Google its complete monopoly of Internet search.
Investors love Big Tech (i.e., FAANGS) because they’re untouchable and they soar through good times and bad. Hard to beat as a solid investments and many advisors have them as a BUY rating.
This year, Google and Facebook have been awesome up 48% and 34% each while Amazon is up 14% YTD. Apple is worth $2 Trillion now. Add Tesla and Nvidia, two other companies succeeding well post-pandemic and you can see why investors want big tech stocks.
Even though Google and Facebook face anti-trust action in Europe and the US, no one believes anything will stick to the teflon Dons of the stock market. And even if these companies are broken up, the value of their individual pieces might surprise everyone. As the economic recovery continues, their profit will only grow, given their isn’t much competition to hold them back.
“And although investors can turn to other top performers during the economic recovery with impressive earnings (earnings stocks), the FAANG stocks just seem comfortable and familiar to many of them.”Tech is still a good play for many investors and a critical part of a longer term portfolio,” said Jim Baird, chief investment officer of Plante Moran Financial Advisors. “We wouldn’t tell people to move out of the tech sector because there are some great names there.” from CNN report.
The FAANG stocks Facebook, Amazon, Apple, Netflix, and Google are 5 key tech stocks every investor should know. They’re a big portion of the big stock indexes and on the S&P forecast or NASDAQ forecast.
Given their stability, security, and persistent profitability, they’re a primary tech stock pick for most institutional investors and those with 401k or retirement savings plans. The 2nd quarter 2020 earnings reports were outstanding. Investors are not deterred with antitrust investigations, Covid 19 outbreaks, or stimulus it seems. They have too commanding marketshare and in the tech platforms they’ve created.
The FAANG group was named by Jim Cramer of Mad Money fame.
Overall, the 2020 forecast for FAANG stock prices is positive for most of Jim Cramer’s FAANG stocks, but each has its own head winds. Apple stock price is raging upward, particularly this last week. See charts below.
Should you buy FAANG stocks? Some experts believe you should buy them and never sell. If you’re a long term investor, it is reasonable that these companies will come out shining through any economic outlook. It seems the economic outlook for the next 5 years is bright. But there is a lot to know about each individual stock.
Some analysts are turning negative on the FAANG stocks. They’re suggesting small business stocks will have greater earnings growth from 2020 to 2024. These companies are cash rich, have vital consumer data and minimal competition, and innovative business models that will help them adjust in any economic climate. There are almost 40 FAANG ETFs you might buy as well. Check the performance.
It was believed that “America First” policies would destroy multinational profits, but the FAANG stocks could survive nicely with unlimited growth in the US. The recent earnings reports released by Google, Apple, Amazon, and Facebook, show the threat to multinational marketshare and profits has been overplayed.
Investor’s Postive Outlook on FAANGs
The FAANG stocks were doing fine until the China tariffs set in. Earnings season brought everyone back to earth and either the FAANG companies didn’t want to pay out, or investors realized their China exposure was a big sell sign.
As the pandemic begins to fade, FAANG stock Netflix might see its fortunes wane. Although it’s inking deals for original content, it’s revenue outlook is a concern for stock market investors. See more on Netflix.
With Jeff Bezos leaving the helm of the Amazon ship and pushing off into space on Blue Origin, Amazon is getting more press, but will it be as successful and comfortable for investors in the post pandemic period? See more on the Amazon price forecast.
Betting against Amazon, given the shift to online shopping and cloud computing is probably not wise.
Google – Alphabet
Google’s revenue growth is the key issue for Google stock price for many investors, as it’s all about future earnings. Google’s ad revenue, including its revenue from Youtube are something to focus on. See more on the GOOG stock price forecast.
If the monopoly type companies under perform, the talk about anti-monopoly action might die down. However, these companies have plenty of threats during a highly volatile, transitionary economy. Take a look at Longforecast’s Google outlook for 2021.
Apple’s fortunes have fallen quickly. Revenue’s continue to fall although the company is making adjustments with a focus on services. Apple stock price just hit an all time high. Apple’s cost control issues foretell vulnerability to big stock market corrections or perhaps a price crash in 2022? Still, take a look at Moneymorning’s prediction that Apple’s stock price would reach $300 by 2020.
Facebook stock price has had a steady decline since last summer. Last year Facebook missed projections and the stock price plummeted 25%. Facebook has a huge customer base and they don’t share revenue with anyone almost, unlike Google who pays out revenue share to publishers. See more on the Facebook stock outlook.
Some feel Facebook is massively undervalued and it may only be the limited imagination of its management that’s stopping it from big growth. It’s looking to buy an internet security company to help it avoid data breaches. Hear Paul Schatz, Heritage Capital president and chief investment officer bullish outlook of $200 per share. It’s now $247 per share!
CNBC chimes in on the FAANG’s new blowout Quarter:
Just because business is moving back to the US, doesn’t mean the FAANGs can’t make mountains of money. Given the lack of political will in the US to control them, they’ll likely adjust and become super monopolies.
Stock Market 2021/2022
Stock Market Predictions | Will Stocks Rise Further? | Best Stocks | 3 Month Stock Market Forecast | 6 Month Forecast | Stock Market Crash? | China Economic Forecast | AI Stock Forecast | Stock Market Forecast | Google Stock Price Forecast | Tech Stock Predictions | Cramer Stock Picks | What are the Best Stock Picks for 2021? | Investing in Stocks | Housing Market Bubble | Real Estate Marketing | Gord Collins
* the above post includes opinions of the author and do not connote recommendations of any kind regarding stocks to invest in. The material is provided as information only.