Facebook, Amazon, Netflix, and Google’s parent company Alphabet have all made positive stock market gains in 2019. They’ve grown double digits since early December, making up over $600 billion in market capitalization.
What to expect from FANG stocks in 2019
And some analysts are predicting even bigger gains in the future. Here’s what to look for in the upcoming year:
Facebook’s user growth slowed substantially in 2018, which is likely due to social media saturation in developed countries. The company does still have quite a bit of growth potential in underdeveloped countries.
For instance, the platform has only reached 15 percent user penetration in Africa. Facebook is attempting to build an underwater data cable around Africa in hopes of increasing internet connectivity. This is a long way from becoming a reality but it does bode well for Facebook’s future user growth.
And of course, Facebook will likely bring in new revenue from the e-commerce addition to Instagram. Instagram currently has a billion users so the potential from new revenue is huge.
Amazon got off to a strong start in 2019 and their shares are currently up 6.8 percent. The company’s digital advertising business is one of the largest in the world, falling short only to Facebook and Google.
Amazon is seen as a leader both in consumer goods but also in enterprise AI. Cloud computing will likely continue to be a profitable source of revenue for the company.
Netflix is expected to issue an earnings report next week and investors will be looking at the company’s revenue and cash burn. But it will also be useful to see how many paid members Netflix added, as this is a good gauge of the company’s overall financial health.
Netflix added 8.8 million users in the fourth quarter of 2018, which brought their active monthly users to 139 million. Based on previous trends, their growth will likely be lower than this but it’s still reasonable to expect the company to add an additional six million users.
Investors will be especially interested in user growth given the recent announcements that Apple and Disney are launching their own streaming services.
Google continues to be a global leader in internet and mobile searches. The company’s stock has declined in 2019 but it’s still trading above $1,200 per share. And on the CNN Business portal, 37 analysts predicted that the stock would top $1,350.
Overall analysts seem to be optimistic about Google’s growth. On CNN, 38 out of 40 analysts are recommending to buy Google stock.