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NEW YORK (
TheStreet) -- Citi has initiated coverage on the Internet sector, targeting a wide array of topics and names, from
Google(GOOG - Get Report) to
Amazon(AMZN - Get Report) to
Yahoo!(YHOO - Get Report). Those three, as well as
eBay(EBAY - Get Report) and
AOL(AOL), received buy ratings.
In all, Citi started coverage on 11 names, noting that "the Internet industry is still in the early innings of its growth cycle." Analyst Mark May notes that the sector is poised to see a surge of Internet-centric consumers who are in the prime of their buying and influence stages, primarily driven by the Millennials. As this group continues to gain more influence in the U.S. economy and makes larger and more purchasing decisions, it's poised to shape commerce.
The Internet is also benefiting from the mass adoption of smartphones and tablets, as well as high-speed access, which connects more and more devices, not to mention the
"Internet of things."
Citi started coverage on
Zillow(Z), with neutral ratings. The research firm is constructive on these names, but either valuations are lower, or near-term issues, such as catalysts or expectations, are not as clear as for some of the other higher-rated names.
OpenTable(OPEN) was given a sell rating, with May noting that, while it's still a good business, "...the valuation and expectations do not reflect the level of serviceable market penetration and likely deceleration in growth over the next 2-3 years."