FAANG ETFs In The Spotlight Ahead Of Q4 Earnings

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The FAANG stocks — Facebook (FB - Free Report), Amazon (AMZN - Free Report), Apple (AAPL - Free Report), Netflix (NFLX - Free Report) and Alphabet (GOOGL - Free Report) — have been outperforming the market over the past three months buoyed by the initial U.S.-China trade deal. Hopes of better-than-expected earnings releases are also adding to the strength.

Streaming giant, Netflix, the first company in the FAANG group to report Q4 earnings on Jan 21 after market close, came up with strong results for fourth-quarter 2019. The company topped both earnings and revenue estimates and delivered strong subscriber growth. However, it offered a weak outlook, raising concerns about its dominance in an increasingly crowded field.


Facebook is expected to release its earnings report on Jan 29 after market close. Our proven model predicts an earnings beat for Facebook this time around as it has a Zacks Rank #3 (Hold) and an Earnings ESP of +2.62%. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 increases the chances of an earnings beat. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

The social media giant has seen positive earnings estimate revision of a penny for the to-be-reported quarter over the past month. Analysts raising estimates right before earnings — with the most up-to-date information possible — is a good indicator for the stock. The current Zacks Consensus Estimate for the yet-to-be reported quarter indicates earnings increase of 5.46% from the year-ago reported figure. Revenues are expected to increase 23.40%. However, Facebook came up with an average negative earnings surprise of 20.06% for the last four quarters. The stock has a VGM Score of A and belongs to a bottom-ranked Zacks industry (bottom 33%). Shares of FB were up 15.1% in the past three months.

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