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2 FAANG Stock “Buy Strong” to Watch Heading Into Earnings

Big Tech has been in the news lately, and not necessarily for the right reasons. Allegations of corporate censorship have hit the headlines in recent weeks. Although serious, this can have a beneficial effect – it is high time to debate the public about Big Tech’s role in our digital lives. And that discussion will begin just as the Q4 and full-year 2020 financial numbers begin to come into play. Of the FAANG stocks, Netflix has already reported; the other four will release results in the next two weeks. Therefore, the forthcoming earnings will garner much-needed attention, and top Wall Street analysts are already publishing their opinions on some of the most important components of the market. Using the TipRanks database, we extracted the details on two FAANG club members to find out how The Street believes that each will thrive when they publish their fourth quarter numbers. According to the platform, the two have received plenty of love from the analysts, earning them a “Strong Buy” consensus rating. Facebook (FB) Let’s start with Facebook, the social media giant that has redefined our online interactions. Along with Google, Facebook has also brought us targeted digital marketing and advertising, and mass internet monetization. It has been a profitable strategy for the company. Facebook’s market cap is up to $ 786 billion, and in the third quarter of 2020, the company reported $ 21.5 billion on the top line. Looking ahead to the Q4 report, which was due out January 27, analysts forecast revenue at or near $ 26.2 billion. This would be in line with the company’s pattern of increased quarterly performance from Q1 to Q4. At the forecast amount, revenue would rise 24% year-on-year, broadly in line with the 22% yoy earnings already seen in Q3. The key metric to watch out for will be the growth in daily active users; this metric slipped slightly from Q2 to Q3, and further decline will be seen as an ominous sign for the company’s future. As it stands, Facebook’s average daily user count is 1.82 billion. Prior to print, Oppenheimer analyst Jason Helfstein boosted his price target to $ 345 (from $ 300), while repeating the Outperform (i.e. Buy) rating. Investors stand to pocket ~ a 26% gain should the analyst’s thesis play out. (To watch Helfstein’s story, click here) The 5-star analyst said, “[We] anticipate that 4Q advertising revenue will be on hand to top Street estimates. We now forecast 4Q + advertising revenue estimated at 30% y / y versus Street + 25% based on regression of US Standard Media Index Data (0.95 squared) and accelerating global CPM data from Gupta Media (4Q + 35% y / y vs 3Q’s -12%). Additionally, we are very bullish on the FB eCommerce opportunity following conversations with our checks and our initial work conservatively estimates Shops a $ 25-50B opportunity against current $ 85B reviews. We believe that shares currently trading at 7.1x EV / NTM sales offer the most favorable risk / reward in a large cap on the internet. “Overall, the social media empire continues to be a Wall Street darling, like TipRanks analytics that displays FB as Sure Buy. This is based on 34 recent reviews, which breaks down to 30 Buy rating, 3 Holdings, and 1 Sell .The share price is $ 276.10 and the average price target of $ 327.42 suggests a year up of ~ 19%. (See FB stock analysis on TipRanks) Amazon (AMZN) By Turning to e-commerce, we can’t avoid Amazon.The retail giant has a market cap of $ 1.65 trillion, making it one of only four publicly traded companies priced over the trillion mark The company’s celebrity price is notoriously high, and has grown 74% since this time last year, much more than the broader markets Amazon’s growth has been supported by increased online sales activity in during the ‘corona year.’ Globally, online retailing has grown 27% in 2020, while total retail has slipped 3%. Amazon, which dominates the online retail sector, is forecast to end 2020 with $ 380 billion in total revenue, or 34% year-on-year growth. Global e-commerce earnings Cowen analyst John Blackledge, a 5-star TipRanks graduate, deals with Amazon and is bullish on the company’s forecasts ahead of the earnings release Blackledge rates the stock as outperforming (ie Buy), with its price target, $ 4,350, showing 31% upside confidence on the time horizon of (To watch Blackledge history, click here) “We forecast 4Q20 of reported revenue of $ 120.8BN, + 38.2% y / y vs + 37.4% y / y in 3Q20 led by AWS, advertising, subscription and 3P sales [..] We estimate that the US Prime Prime sub-acceleration accelerated in 4Q20 (reaching 76MM subdivision in December ’20 and ~ 74MM on avg in 4Q20), aided by a pandemic call, Prime Day in October, and ribbon shopping period, as well as 1 Day delivery. […] In ’21, we expect strong frontline growth to continue to be driven by eCommerce (with the help of COVID to pull in Grocery), adv., AWS & subsidiary businesses, “opined Blackledge. Wall Street in general is not bullish on Amazon a secret; the company has 33 reviews on record, 32 of which are Buy, versus 1 Hold. The share price is $ 3,301.26 and the average price target of $ 3,826 suggests that it will grow 16% another this year (See AMZN stock analysis on TipRanks) To find good ideas for stocks trading at attractive valuations, visit TipRanks Best Stocks to Buy, a newly launched tool that unites all equity insights Disclaimer: The opinions expressed in this article are solely the views of the analysts concerned, intended for informational purposes only It is very important to do your own analysis before making any investment.

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