Analysts at RBC Capital Markets on Friday initiated coverage on five top tech stocks. While one might ask what took them so long, the wait might have been worth it. Three of these stocks sport market caps near or above $1 trillion, so even modest growth can be meaningful.
Take Amazon.com Inc. (NASDAQ: AMZN), for instance. RBC initiated coverage on the stock Friday morning with an Outperform rating and a price target of $4,150. The analysts also added Amazon to its list of the top 30 global ideas, the firm’s list of high-conviction investments.
Over the past 12 months, Amazon stock has added a meager 4.3% to its share price, and it traded early Friday morning at around $3,286.60. At that price, the upside potential to RBC’s price target is more than 26%. The firm’s target is essentially equal to the consensus price target and not that far away from the high target of $5,000.
Citing Amazon’s enormous scale, vertical integration in e-commerce, and its industry-leading cloud business, RBC sees Amazon as having “many shots on goal for future growth opportunities in new verticals.” The analysts are particularly impressed with Amazon’s booming ad business, calling it “a massive opportunity to drive accretive growth.” And RBC is not especially worried about regulatory risk, seeing the risk as “relatively low” compared to the long-term value Amazon offers.
The stock’s 52-week trading range is $2,881.00 to $3,773.08, and Amazon’s market cap is $1.66 trillion. The company does not pay a dividend.
Coverage of social media giant Facebook Inc. (NASDAQ: FB) also was initiated with an Outperform rating. RBC’s price target of $425 is just 1.8% higher than the consensus, but the upside potential based on a current price of around $341.30 is 32.4%. The high price target on Facebook stock is $500.
RBC acknowledges Facebook’s “unmatched knowledge of the world’s consumers” but thinks that future growth is tied to Facebook’s ability to “deepen its relationship with its nearly 3 billion users.” The analysts think that the company is well-positioned to transform itself from a “social-centric platform to a fuller source of online utility.” RBC sees little impact from Apple’s recent change requiring companies to choose what personal information users are willing to share with app developers.
Facebook stock traded up less than 1% Friday morning, in a 52-week range of $244.61 to $384.33. The company’s market cap is $962.56 billion, and Facebook does not pay a dividend.
Sponsored: Find a Qualified Financial Advisor
Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to 3 fiduciary financial advisors in your area in 5 minutes. Each advisor has been vetted by SmartAsset and is held to a fiduciary standard to act in your best interests. If you’re ready to be matched with local advisors that can help you achieve your financial goals, get started now.