FAANG angst is back with a vengeance.
This week, each of the FAANG stocks tumbled into bear market territory, shedding more than $1 trillion in collective value off their recent highs.
"It is very hard to call a bottom in FAANG, as these companies are driven by different end markets and fundamental factors," said Andrew Braun, a portfolio manager at Pax World Funds. "The recent volatility in FAANG has been disproportionately driven by weakness in Apple and its suppliers."
Among the FAANGs, Apple (AAPL) has slumped in recent days alongside reports of lackluster iPhone demand, Facebook (FB) is facing ongoing criticism that management is not in control of its business and Amazon's (AMZN) stock has faltered since the company issued weaker-than-expected guidance for the fourth quarter. Irrespective of their individual strengths and weaknesses, however, investors are generally taking a more critical look at the sky-high valuations of the popular FAANG names, according to Brian Sterz of wealth management group Miracle Mile Advisors.
"A lot of what we're seeing is a re-reading of what the valuations should be," Sterz said. "Amazon is a great company, and AWS is a phenomenal business -- but in a shaky economy, is that worth a 100 or an 85 [price-to-earnings multiple]? It's hard to sustain those high valuations when things get tricky."
Netflix (NFLX) , which traded at a 96 price-to-earnings multiple as of Nov. 20, is another case: "Should it trade at 80 or 100 P/E? That's a big spread," Sterz added.
Without knowing what's in store for the broader markets -- trade tensions and rising interest rates are just two of the issues sparking market volatility in recent weeks-- it may be tough to predict what's in store for the FAANG stocks as a group, or whether they'll continue to dominate the market in the same manner going into 2019 and beyond.
"I think if we do see the beginning of a downturn, whether it's FAANG or other highly-valued names, they do have more room to come down. I'd kind of lean on that," Sterz added. "And that's not to say that their businesses aren't good."