FAANG stocks insight, preparing for the comeback
Tech stocks are currently struggling, along with growth stocks, as the sell-off triggered by rising inflation fears continue to linger in the minds of the traders.
By: HyperCharge Technology
Facebook, Amazon, Apple, Netflix and Google parent Alphabet composes the FAANG stock. As the Big Tech took a clean hit, investors are trying to gauge which of the group can bounce back stronger and which of them would continue to struggle. They're trying to identify which of the five are more profitable for the bounce back and which stock should be avoided.
Some suggests that Apple is the best candidate for the rebound as Apple consistently performed year over year, despite previous sell-off from Cathie Wood. When looking at year by year performance of Apple, it does not disappoint and always manage to pull through such struggles.
If we are to look into the bullish side, traders marked Alphabet. Google is basically strong on its foundations and their ad business are booming while the economic recovery is underway, and is not expecting any changes even when the recovery is completed.
Now if we talk about the bearish one, investors are looking at Netflix. Currently, the most recent earnings report of Netflix reflects outstanding performance by beating earnings estimates, however, its guidance was off the mark as it was not able to add 6 million new subscribers on Q1.
The year over year data also shows that the company lost about 9% share of streaming services in U.S. alone from 2019 to 2020. Netflix is underperforming relative to S&P index and its competitor Disney. Another concern raised is that the production of original contents of Netflix are high cost, the subscriber growth has slowed down a lot, and new providers or competitors are eating on it.
All in all, as far as the FAANG stocks are concerned, traders agree that Netflix could be in for more pain, while Google has a good change of bouncing back, along with Apple.
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