Technology
BofA Securities Very Bullish on FANG Stocks for Q2 and Beyond
March 31, 2021 7:53 am
The huge social media leader has been on a roll, and the analysts remain very positive. Facebook Inc. (NASDAQ: FB) is the largest social network, with over 2.3 billion monthly active users and over 1.6 billion daily active users. The company generates revenue from advertising and from payments, with over 95% of revenue from advertising. It generates close to 50% of revenues in the United States and Canada and is expanding rapidly in international markets.
The company’s solutions also include Instagram, a mobile application that enables people to take photos or videos, customize them with filter effects, and share them with friends and followers in a photo feed or send them directly to friends. Messenger, a messaging application for mobile and web on various platforms and devices, enables people to reach others instantly, as well as enable businesses to engage with customers. WhatsApp Messenger is a mobile messaging application.
The company has been under intense scrutiny lately, along with other big-tech giants. Some people allege there has been unreasonable censorship, and it is yet another that may be targeted by either Congress or the Department of Justice, or perhaps both. With that noted, it remains one of the largest and most powerful social media platforms in the world.
BofA Securities has set a $358 target. The consensus target is $338.72, and Facebook stock closed at $288 on Tuesday.
Netflix
This Wall Street darling offers a great entry point after selling off from all-time highs back in January. Netflix Inc. (NASDAQ: NFLX) is the world’s leading internet television network, with more than 120 million members in over 190 countries enjoying more than 125 million hours of TV shows and movies per day, including original series, documentaries and feature films.
Members can watch as much as they want, anytime, anywhere, on nearly any internet-connected screen. Members can play, pause and resume watching, all without commercials or commitments. Netflix is available on virtually any device with an internet connection, including personal computers, tablets, smartphones, smart TVs and game consoles, and it automatically provides the best possible streaming quality based on the available bandwidth.
Many titles, including Netflix original series and films, are available in high-definition with Dolby Digital Plus 5.1 surround sound and some in Ultra HD 4K. It appears Netflix may be cracking down on password sharing. Many on Wall Street view such crackdowns as a tailwind, and Netflix is in a strong position to continue price increases in 2021.
The $680 BofA Securities price target compares with the $619.43 consensus estimate. Netflix stock ended Tuesday’s trading at $513.39.
It is somewhat ironic that after being the talk-of-the-town on Wall Street for years, these hugely successful (and most importantly profitable) companies took a back seat to momentum names, many of which make no or very little money. With the market very pricey, and perhaps vulnerable to tail risks like massively overleveraged hedge funds, it makes sense to continue to bet on these mega-cap leaders.
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