FAANG Stocks (FB, AMZN, AAPL, NFLX, GOOG) Struggle but Bright Spots Remain
It’s no secret that the much-heralded FAANG stocks (FB, AMZN, AAPL, NFLX, GOOG) have all been in a state of sharp decline since October. And a couple of them started their declines much earlier than that. But just how badly (or well) have they been doing in 2018, year-to-date?
First off, if you’re not familiar with the FAANG acronym, it’s a variation of Jim Cramer’s (of CNBC ‘Mad Money’ fame) term, FANG. FANG originally stood for a handful of the largest and most popular, top-performing tech stocks. They included: FB (Facebook), AMZN (Amazon), NFLX (Netflix), and GOOG (Alphabet). AAPL (Apple) was later added on (it’s unclear why it was excluded in the first place) to coin the new acronym, FAANG.
As of the market close on Monday, November 26, progress for the FAANG stocks overall this year has been mixed. Sharp stock declines in the last few months have erased much of the gains made earlier in the year. As is usually the case, though, some of the FAANG stocks have done much better than others. And one of those others has done rather horrendously.
The chart above shows a year-to-date performance chart for the FAANG stocks. The current price and percentage returns for the year are labeled on the y-axis.
Clearly, Facebook is the big loser, which is unsurprising given the scandals and turbulence the company has had to navigate throughout this year. Apple and Alphabet (Google) have fallen to the point of being around flat for the year.
The biggest surprise, though, is that despite the steep market declines and heavy bearish pressure on the tech sector lately, Netflix and Amazon have still done remarkably well under the circumstances. Both are up more than 30% for the year so far, which is A LOT more than the S&P 500, Dow, or Nasdaq can say. The three major indexes are all either nearly flat or slightly negative YTD. And if not for the large October-November dips, NFLX and AMZN would clearly have done even better.
So what’s the takeaway, if any? Media talk about the demise of the FAANGs may be premature, even amid the current market environment of highly-elevated volatility and frequent sharp declines. Yes, FB and GOOG and AAPL may currently be struggling mightily. But NFLX and AMZN are still on course to produce handsome returns for their investors this year. If things keep going the way they are, though, FAANG may soon need to be changed to AANG, or even AN.
(See also: “Tech Stock Performance Chart: From FAANG to MAGA?“)
IMPORTANT: The information above should not be construed as investment advice and should not be considered as a solicitation to buy or sell securities. Past performance is not indicative of future results. Trading and investing in the financial markets involves substantial risk of loss, and may not be suitable for all investors.
Disclosure: At the time of this article’s publication, we have no position in any security or trade/investment mentioned, nor do we have any business relationship with any company whose stock may be mentioned.
Senior Market Analyst at The Technicals
A veteran global macro trader/analyst, Bart focuses on major market moves in currencies, commodities, fixed income, and global equity indexes. Bart stresses inter-market correlations and dynamics while keeping a close eye on risk. He has published countless market analysis pieces and has been a guest expert for a variety of major financial media. Contact Bart