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Amazon.com Inc. (AMZN)
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Meta Platforms Inc. (META)
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Alphabet Inc. (GOOG)
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Shopify Inc. Class A Subordinate Voting Shares (SHOP)
Analysts' commentary/preview has generally been positive with expectation of company announcing strong results and guidance on November 2nd. What are your thoughts ?
Thank You
Big tech stocks are getting hammered this week, on concerns that the economy is going to impact their results as well. Investors are in a 'sell everything' mood. We are not overly worried about the fundamentals of SHOP. It has addressed its cost issues, cleaned up its structure (selling logistics) and have no additional reasons to expect a bad quarter (its history on 'beating' is decent). That being said, its high valuation (95X earnings) certainly makes it more vulnerable in a sell off. It moves, on an absolute average, of 8% on earnings releases. In the past decade, moves have been as high as +24% and as low as -17%. We think it will be OK, longer term, but the current market malaise likely will limit its potential gains in the short term. We can't comment on personal weightings but would note our Balanced Model portfolio has it at about 5% right now.
Authors of this answer, directors, partners and/or officers of 5i Research and/or affiliated companies have a financial or other interest in AMZN, META, GOOG.