The FAANG stocks have found their footing and appear to be on
the mend after cratering in the Q4. Netflix has been the best performer,
followed by Amazon, Facebook, Alphabet and Apple. Apple has already warned
about Q4 earnings, and it appears that cell phone sales in China continue to
This makes share trading volatile. Analysts have taken down
technology earnings for the Q4 leaving the reporting season as a time where
positive surprises could occur.
Netflix is Poised to Release Earnings
Netflix shares have been on a tear rallying 37% off the
bottom hit in mid-December. Netflix will report Q4 and there does not appear to
be any calls for a downgrade of future revenues which was reported by Apple
last week. The company is expected to release its Q4 earnings on January 19.
The average EPS estimate is $0.24 per share. There has been no movement of
expectations in the last 60-days. Growth is actually expected to decline by
more than 40% in the current quarter and then rebound in the Q1 of 2019. The
company is expected to produce revenues of 4.2 billion which is sales growth of
Amazon Should Continue To Outperform
Amazon shares are also on the mend. The stock price was
pummeled in the Q4 after hitting 1-trillion in market value in October. The share price seems to have found a bottom
and is gaining traction rising back above the $1,600 mark. Recall the stock price was above $2,050 per
share in early October. The company is expected to report financial results on
February 7, 2019. The company is
expected to earn 5.56 per share based on the average of 43 analysts. Earnings
per share in the same quarter a year ago was 2.16 per share. Revenue for the Q4
is expected to come in at 71.81 billion, which is 18% sales growth. Earnings
per share has remained steady over the last 60-days and was lowered after EPS
in the Q3.
Apple is Attempting to Form a Bottom
Apple shares where hammered along with most of the technology sector in the Q4, but took a
leg lower following news that the company was lowering its Q4 revenue guidance.
The company reduced and narrowed the range, which led to an immediate market
selloff. The stock price opened down 10% and traded in the low $140’s until
finding some footing. The stock price has been one of the weights in the
technology space and has weighed on the Dow Industrials.
Facebook has been a ball and chain
Facebook has faced headwinds and ahead of earnings the price of the stock has stabilized. Facebook’s model to use customers as
their product to sell to companies that target market, has faced scrutiny, in
both the congress and among users. Many
users have opted to hide their information to avoid advertisements. The company
is scheduled to report its financial results on January 30. Expectations are
that FB will earn 2.19 per share on 16.4 billion in revenue. Sales are expected
to climb 26.4% year over year.