Tech volatility is growing, but Bank of America has tips to help investors.
According to Canaccord Genuity’s Monthly Internet Dashboard, the FANG stocks, Facebook, Amazon, Netflix, and Google are up ~48%, ~29%, ~41%, and ~19%, respectively year-to-date, while the S&P 500 is up ~10%.
Even though these companies are reporting some of the fastest revenue growth rates in the S&P 500, Canaccord’s analysts note that it will be “very tough” for this kind of outperformance to continue.
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However, the four strong secular tailwinds (digital advertising, eCommerce, digital video, cloud), driving FANG performance, coupled with the group’s “reasonable valuations, freedom to make long-term bets with a surplus of resources, and growth” are all supportive of continued strength in the stocks. Only 17 large-cap stocks are...
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