MKM analyst Rob Sanderson on Monday increased his price targets on three popular Internet stocks, Alphabet (GOOGL) , Facebook (FB) , and Twitter (TWTR) , calling for double-digit gains over the next 12 months.
Sanderson reiterated his "Buy" rating and hiked his target on Alphabet's stock to $1,210 per share predicated on his belief of higher revenues. In addition, Alphabet's YouTube will contribute more going forward after clearing hurdles last quarter centered around advertising disputes.
The $1,210 price target is roughly 28% higher than Alphabet's current price of $946.57 a share.
Sanderson also contends Facebook is a "Buy" and increased the price target on the social media giant to $200 from $180 a share, an 18% boost from Facebook's midday price of $171.84 on Monday.
"Valuation has improved through the year as investor concern over a sharp second half growth deceleration has shifted to an expectation of a more manageable decline in growth rates," he said. He argued that slower growth for advertising on Facebook is an actuality but it "will be manageable" and negated by varying pricing models.
As for the beleaguered Twitter, Sanderson reiterated his "Neutral" rating on the stock and hiked his price target to $18 per share, from $16 per share. "The stock dynamic is becoming more interesting. User engagement appears to be improving."
Sanderson believes Twitter's guidance to be too cautious, and expects the company to report an earnings beat as user engagement and growth improve.Alphabet and Facebook are holdings in Jim Cramer's Action Alerts PLUS Charitable Trust Portfolio . Want to be alerted before Cramer buys or sells GOOGL and FB? Learn more now.
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