Wedbush Securities expects another robust year for tech stocks as growth prospects around cloud, cyber security, 5G, and the metaverse peak, heading into 2022.
The investment firm said Apple (AAPL) - Get Apple Inc. (AAPL) Report remains its favorite among FAANG stocks: Facebook, now called Meta Platforms (FB) - Get Facebook, Inc. Class A Report, Apple, Amazon (AMZN) - Get Amazon.com, Inc. Report, Netflix (NFLX) - Get Netflix, Inc. (NFLX) Report, and Google (GOOGL) - Get Alphabet Inc. Class A Report.
Wedbush views supply-chain shortages as a catalyst to a multiyear "supercycle" for Apple's iPhone 12 and iPhone 13 in the years to come and has set an initial target of 19,000 points for the Nasdaq in 2022.
Apple shares added 1.7% Friday, adding to Thursday's gains amid reports that the world's biggest tech company is accelerating its plans to build a self-driving car and could unveil its debut model as early as 2025.
Bloomberg News reported that the tech giant is aiming for a fully autonomous vehicle, with new division head Kevin Lynch looking for a faster-than-forecast release.
The report follows speculation that Apple, which has long been connected to an autonomous driving project, had visited automakers and suppliers in Asia, including Toyota Motor Co. (TM) - Get Toyota Motor Corp. Sponsored ADR Report, as part of its early-stage preparations.
Citigroup analyst Jim Suva argued in March that an electric car rollout could propel Apple to a $3 trillion market cap, while Wedbush analysts Dan Ives, a long-time Apple bull, told TheStreet in August that a so-called Apple Car is "not a matter of if, it’s a matter of when."
"I believe they are continuing to build a vision, the infrastructure, they are looking for partnerships on the battery side," he said "They are not going to miss out on the $5 trillion green tidal wave.”
The Apple Maven Daniel Martins has recently talked about why Apple stock had come within striking distance of its historical peak. With a couple of recent sell-side reports fueling optimism about Apple’s 2021 holiday season (iPhone sales could set a record) and long-term opportunities in the metaverse, investor sentiment quickly shifted to bullish.
Then, the news surfaced that the long-awaited Apple Car could be closer to seeing the light of day than many imagined and could be launched in as little as three to four years. Bloomberg reported that Apple has advanced in developing the chip technology needed to build a driverless car without a steering wheel or pedals.
"As of Nov. 18, every investor who had held Apple stock for any more than 10 minutes was officially above water," Martins wrote.
But, Apple isn't the only tech company breaking into the electric vehicle space. Rivian Automotive (RIVN) - Get RIVIAN AUTOMOTIVE, INC. Report, which went public on November 9 and is currently valued at over $100 billion on the heels of a post-IPO rally, is 20% owned by the e-commerce titan Amazon.
Amazon has ordered 100,000 Rivian vehicles to be delivered by 2030. "The partnership is a big deal for Rivian, but it may also be one for Amazon," wrote Martins.
Amazon shares ended the week 4.3% higher.
News Corp. (NWS) - Get News Corporation Class B Report Chairman Rupert Murdoch has made clear his dislike for Meta Platforms (Facebook) (FB) - Get Facebook, Inc. Class A Report and Alphabet’s (GOOGL) - Get Alphabet Inc. Class A Report Google over the years and did so again on Wednesday. The criticism came at News Corp.’s annual meeting. Murdoch thinks the duo stifles conservative views -- his media holdings' stock and trade -- and plays dirty.
"For many years our company has been leading the global debate about big digital," he said, according to Reuters. "What we have seen in the past few weeks about the practices at Facebook and Google surely reinforce the need for significant reform."
But, investors like Google and Facebook. Alphabet stock has soared 31% over the past six months and Facebook has climbed 8% in the same period.
Here is a breakdown list of the technology and FAANG/MAMAA stocks to watch right now based on their performance over the past week:
Meta Platforms Faces Investigation Into Instagram's Influence On Teenagers
The state attorneys general from nine states said they will investigate Instagram’s influence on teenagers and their wellbeing. Meta, the company formerly known as Facebook, will be investigated by a bipartisan group of state attorneys general from California, Florida, Kentucky, Massachusetts, Nebraska, New Jersey, New York, Tennessee, and Vermont.
The investigation includes whether Facebook broke any state consumer protection laws and put the public at risk when it promoted Instagram, a social media app used for posting photos and videos, according to Maura Healey, the Massachusetts attorney general.
Apple Launches Self-Service Repair Program
After years of complaints about the cost and difficulty of its repairs, Apple launched a program that offers users the chance to do it themselves with official parts and tools. The tech giant announced on Wednesday that it would start selling Apple parts for users to repair their iPhones and Macs.
Known as Self Service Repair, the program will first be available for the most recent iPhones 12 and 13 and enable users to fix common problems with display, battery, and camera. To do it, a user will have to place an order through the Apple Self Service Repair Online Store and receive a repair manual with the necessary parts at home. (The old parts can be sent in for recycling.) The self-service option will be coming to the U.S. early next year and international destinations by the end of 2022.
Amazon Named Top Stock Pick For 2022 in the Internet Space by Goldman Sachs
Goldman Sachs named Amazon as its top stock pick for 2022 in the Internet space, with Uber (UBER) - Get Uber Technologies, Inc. Report, Lyft (LYFT) - Get Lyft Inc Class A Report, Snap (SNAP) - Get Snap, Inc. Class A Report, and Meta Platform (Facebook) also on the list of top picks.
Goldman analysts led by Eric Sheridan said: “we see our top pick for 2022, as we view this recent earnings report as fully reflective of investor concerns on both revenue and profitability into 2022. Amazon is exposed to a multitude of broader secular growth themes, including e-commerce, advertising, cloud computing, media consumption, and consumer subscription adoption."
Why Roblox Is the Metaverse Stock to Own
Roblox (RBLX) - Get Roblox Report is the metaverse stock to own. Roblox is investing $100 million in three videogames that it plans to bring to middle-school, high school, and college classrooms. As reported by The Wall Street Journal, the videogame producer's project is designed to expand beyond its users beyond teens and preteens and to join the internet effort called the metaverse. Designed as a way for players to create their own games, Roblox now features millions of games from its users.
Athletic shoe/apparel titan Nike (NKE) - Get NIKE, Inc. (NKE) Report announced Thursday that it’s creating a virtual world on the Roblox video game platform called Nikeland. The site is free for now, and Nikeland allows Nike fans to “connect, create, share experiences and compete,” Nike said. It “created this bespoke world with the backdrop of its world headquarters and inside Roblox’s immersive 3D space, building on its goal to turn sport and play into a lifestyle.”
Microsoft Named Favorite Cloud Stock by Wedbush Analysts
Wedbush analysts Dan Ives and John Katsingris have listed Microsoft (MSFT) - Get Microsoft Corporation (MSFT) Report as their favorite name in cloud stocks. "Azure's cloud momentum is still in its early days of playing out within the company’s massive installed base and the Office 365 transition is providing growth tailwinds into 2022," they wrote.
Microsoft shares moved higher Tuesday after a new team of Credit Suisse analysts assumed coverage of the tech giant with an outperform rating and $400 price target. “For at least the next five years, we forecast Microsoft to deliver mid-to-high teens revenue growth,” the analysts, led by Phil Winslow, wrote in a client report, noting the gains will be driven by mid-20s% growth in intelligent cloud, mid-teens growth in productivity and business processes, and 2%-to-5% growth in Windows, they said.
Google Parent Alphabet Faces EU $2.8 bln Antitrust Fine From 2017
Alphabet lost a round in a legal fight after the EU's General Court upheld a European Commission ruling against the company for antitrust infractions. The Mountain View, Calif., search, cloud-services and advertising giant is facing a 2.42 billion euro ($2.8 billion) fine in the case.
EU regulators ruled in 2017 that Google had pushed its own shopping services on its platforms. The company contested the ruling, leading to a years-long review process. The verdict can be appealed and taken to the EU's highest court. Alphabet told TheStreet that it would need to review the decision before deciding whether to appeal.
Netflix Rival Roku's Stock Plans to Develop 50 Original Shows In New Content Push
Roku (ROKU) - Get Roku, Inc. Class A Report shares bumped higher Friday following a report that the streaming service hub will move into content development, with plans to produce as many as fifty shows over the next two years. The Wall Street Journal said Roku will change tack from its previous insistence on staying out of the content game with a plan to leverage the 155 million people that use its streaming aggregation service.
The Journal said Roku wants to direct more of those customers to its Roku channel, where it gets a full return on ad sales, compared to the 30% cut it gets from ads viewed on other apps on the platform. Roku would likely spend between $250,000 and $750,000 for an unscripted episode, with costs rising to as high as $5 million for a scripted one, although that would still be 'significantly less' than budgets typically allocated by rivals such as Netflix (NFLX) - Get Netflix, Inc. (NFLX) Report.