Time to be clinical about FANG -- Facebook ( FB) , Amazon ( AMZN) , Netflix ( NFLX) and Google, now Alphabet ( GOOGL) -- so we know what awaits us.
First a note on these stocks. I picked them largely because over the years they have become anointed by a group of go-go managers, meaning managers who like to be affiliated with the stocks of companies with the most momentum. I by no means have said "buy these stocks" because they represent great value. What I have been saying is that because of the scarcity of actual high-growth stocks these have become default names that managers naturally gravitate to.
You can always tell what I like by looking at the portfolio that is my charitable trust, Action Alerts PLUS, to see if I actually own some of these stocks for the trust. Right now, AAP owns Facebook and Alphabet because they can be justified on an earnings basis vs. their growth rate.
So let's dive right in.
First is Facebook which reports Jan. 27. Facebook has a monopoly -- a monopoly on you. Along with subsidiary Instagram, Facebook has become the biggest source for native advertising in the world and as advertising goes digital you need to understand that means it is going to Facebook and, to a lesser extent, Google. I deal with a great number of executives as part of my job and when they say they are trying to reach people digitally that usually means either Facebook or Google. (They have not had much luck using Twitter to date, which is why that stock is a perennial loser).