A Spread Of ETFs To Tap The Dip In FANGs

The FANG stocks — Facebook (FB - Free Report), Amazon (AMZN - Free Report), Netflix (NFLX - Free Report) and Alphabet (GOOGL - Free Report) — have been the hottest cluster this year. The craze for these stocks has increased on earnings optimism with FANGs hitting new highs lately. Netflix, the first in the group to report its Q2 earnings, after the closing bell on Monday, however disappointed investors with weaker-than-expected subscriber growth., This raised concerns about its long-term growth prospects.

Quick Insights Into Netflix’s Result

The video streaming giant missed its own subscriber forecast for the first time in five years by more than a million, signaling a slowdown in momentum of the streaming-video services. It also lagged the Zacks Consensus Estimate on the revenue front but managed to beat it on earnings. Additionally, it guided weakness in subscriber base and revenues for the third quarter.

Following the sluggish result, Netflix shares plunged as much as 15% in after-market trading, eroding more than $24 billion from its market capitalization. Investors should note that Netflix is the second-best performer on the S&P 500 this year before the earnings, having gained 109% compared with 4.7% gain for index. Current, the stock carries a Zacks Rank #3 (Hold) and belongs to a top-ranked Zacks industry (top 30%). It nevertheless has an inflated P/E ratio of 137.03 compared with the industry average of 11.36 and a disappointing VGM Score of F.

Will Other FANGs Feel the Pain?

Other FANG stocks also felt the pinch of Netflix’s slide in after-market hours with Facebook, Amazon, and Alphabet declining nearly 1% each. Will this trend continue heading into these companies’ Q2 earnings? Right before their earnings, one analyst John Blackledge from Cowen raised its price target on these three FANG stocks. Let’s have a look at their earnings preview picture in detail below:  

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