Last year the stock market was dominated by significant FAANG (Facebook, Amazon, Apple, Netflix and Alphabet’s Google) movement with particularly sharp trading towards the end of 2018.
Wall Street made record highs in 2018 followed by a significant sell-off but analysts see no reason why there may not be a recovery on the cards with notable opportunities in the tech sector.
We look at 3 major tech stocks ahead of their earnings release next week.
- APPLE (AAPL)
2018 saw the popular US stock hit a record high of circa $255 to then plummet to a 18-month low of $142 amid sales concerns in China. Following the announcement that this quarter’s revenue will be shy of its original forecast, citing fewer iPhone sales and upgrades, eyes will be on Apple come 29 January 2019 when it releases its corporate earnings report after the closing bell. Apple braced investors with lower guidance but how did they actually fare over Christmas?
Analyst consensus: 50% buy, 50% hold, 0% sell
Bloomberg average target price: $178 (+16.8%)*
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- 2. FACEBOOK (FB)
The largest social networking site ended 2018 trading 25% down, signalling its worst year of trading since 2012. The company hit lows of $123 — a decline of over 40% — amid amoral ad-targetting and data protection furore. Can Zuckerberg’s plans to invest significantly in the business as it focuses on building out new products such as Facebook Watch and Facebook Marketplace as well as improving cyber security signal a boost for the social network? Facebook releases its earnings report on 30 January 2019. Last time out back in October, their results beat expectations and shares closed $8 higher for a gain of 5.6%
Analyst consensus: 78% buy, 15% hold, 7% sell
Bloomberg average target price: $185 (+29%)*
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- AMAZON (AMZN)
The e-commerce and cloud computing titan is scheduled to report its fourth quarter and full-year results on 31 January 2019. While the company’s third-quarter disappointment may still hover over investors’ heads, can Amazon’s fourth-quarter results and increased operating cash flow improve sentiment towards the popular stock? Amazon gained 31.2% over the last year — a great feat, considering the S&P 500 (including dividends) was down 2.7% over this period. Moreover, can the growing adoption rate and popularity of Amazon Web Services help to accelerate profitability?
Analyst consensus: 94% buy, 4% hold, 2% sell
Bloomberg average target price: $2140 (+35%)*
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Will we see investors keen to swap up some of their favourite tech stocks at a discount? You can buy US or UK stocks with no ticket or management fees, competitive spreads, and low minimum deposits.
If you decide to enter the market and trade around earnings season make sure you carefully research your potential entry points and that you have a strategy that is sensitive to market sentiment.
* Prices and rates accurate as of 24.01.19 & source: Bloomberg
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