Three of four FANG stocks had their price targets raised Friday, following a survey of 70 ad buyers in which 40% said they’ll boost ad spending above previous expectations for the rest of 2018.
Moreover, 27% of ad buyers said they spent more in the first half than anticipated.
The three FANG stocks receiving price-target increases were Facebook (FB), Amazon.com (AMZN), and Google-owner Alphabet (GOOGL). All three are well positioned for the boost in digital advertising, said Cowen analyst John Blackledge in a report to clients Friday. All three report quarterly earnings during the last week of July.
The fourth FANG stock is Netflix (NFLX), on which Blackledge didn’t report.
Blackledge said the Instagram platform of Facebook and Amazon benefited most from the increase in ad spending in the first half, followed by the YouTube platform of Alphabet.
FANG Stocks Rated
Amazon, which was trading at a record high Friday, had its price target raised to 2,100 from 2,000, with a rating of outperform. The positive outlook on Amazon also comes from its booming business in cloud computing, its expansion into new retail categories and its lucrative Prime membership business. Amazon will launch its fourth annual Prime Day on Monday.
Amazon shares were up 0.5%, near 1,805, during morning trading on the stock market today. The company will report quarterly earnings after the market close on July 26.
Blackledge raised his price target on Alphabet to 1,350 from 1,245, with a rating of outperform. It was also trading near at record highs.
Alphabet shares on Friday were up 0.6%, near 1,208.10. The company receives the largest percentage of digital ad spending than any other company, followed by Facebook.
Alphabet reports quarterly earnings after the close on July 23. Alphabet was the IBD Stock Of The Day on Thursday.
Facebook had its price target raised to 235 from 210, with a rating of outperform. It was also trading at a record high.
Facebook shares were up 0.2%, near 207.29 and a record high. It reports after the close July 25.
While data privacy issues for Facebook remain, Blackledge expects Facebook to continue gaining market share in digital ad spending.