Are FAANG Stocks Overhyped and Overpriced? | Phil Town

What interests you about FAANG stocks? Do you think FAANG stocks fit the Rule #1 style of investing?

Amazon is similar to a monopoly because of its ability to dominate multiple markets. Bezos is so rich , spite of losing cash on shipping, that he can’t think of anything to do with that money except blow it on vanity projects like a space mission. Amazon cloud services have better margins and are more important to government — I think amazon doesn’t care that much about retail, per se, but’s it’s a distribution business. Essentially usps, fedex and ups now work for Amazon. Don’t like it, but it’s probably not going to be replaced soon. Microsoft has been “dying” for a long long time, but somehow it’s the dominant computer system software worldwide. Flaws or not., people prefer it to Google’s flakiness. Not sure what the right price for overpriced companies that can’t be killed really is.

I ran the numbers through your Toolbox (my own more conservative numbers, of course) for FB, AMZN, and GOOGL, and FB is selling at a 50% discount. Amazon is below MOS, but their ROIC just hasn't been high enough and their P/E is crazy. Google is a fantastic company and is roughly 45% off right now. This is all according to the most conservative 5 year projected EPS growth rates I could find, and as conservative a future P/E as I could manage to estimate. If the future P/E of AMZN is anything close to the past 5 yr average, then it is MASSIVELY on sale right now. But the average 5 yr P/E has been over 300, and is down around 70 right now, so I'm not sure that's a good one to count on. I used a 58 future P/E, and a growth rate of 29% (even though the consensus is 33%) and got an MOS of $2190. AMZN closed at $1804 today. I just can't get over a P/E that high and such low ROIC. It's definitely on my watchlist as well as GOOGL. I already own FB, and it's trading below it's MOS price right now. As long as it is, I'm loading up on it. You got me thinking though about maybe just building up a reserve of cash and waiting for the Apocalyptic Crash that we all know is coming so that I have a wheelbarrow instead of a thimble. Hmm. Decisions, decisions. Any ideas Phil? (Yes, I know, you can't give specific advice ((unless I paid you, right? Hmm. LOL)))

Man, Buffet's investment in Apple is looking terrible right now. It's down $25/share since the posting of this video. I was shocked to hear he invested in them.

The bigger they get the harder they fall.

Why Microsoft is not one of them? It is the most valuable company in the world!! Shoul be FANAMG

I don’t think they are on sale! Amazon, Netflix and alphabet they are overpriced now. Wait for then to go on sale, then I can buy

USA dividends are weak at these prices. Own some USA stocks but Europe is paying way higher yields if there is a crash I would like to be paid to wait. Mostly I’m in cash but going for higher dividends at this point in the market cycle with what I have.

Google is the strongest of all, IMO.

Buy Apple?

Facebook is dead. Short it.

I follow when a stock is 20% down of what Warren Buffett pays I buy

Well, FAANG stocks look overpriced to me right now, but I believe they are going to be market leaders in their own fields for long periods of time to come, so, if price drops and they come on sale, they look to me a good buy.

FAANG stocks are way over priced with insane PE ratios especially amazon and Netflix. Do a stock price chart for last 15 years for them and you will see an exponential curve. As a mathematician I know anything exponential is bad and it has no where to go but down. remember that. These stocks are overvalued and will fall no question. Just be patient and buy them at 50% discount.

At 4:13 – did you take your money out of APPL or did you ride the 20% drop down since this video?

AAPL, GOOG, AMZN, NFLX, FB already has dropped. Many of the below 200 SMA. Is it time to buy? Or maybe it is the beginning of the next crisis?

Facebook has a margin of safety. Apple might be an opportunity after recent drop. Amazon wait for big drop, same with google. Netflix has a lot of competition coming from Disney especially. Facebook and google I think could have antitrust issues. Amazon I don’t see having antitrust issues since it’s still a small part of retail

are FAANG companies susceptible to competition from China?

Do you have any opinions on green/renewable energy stocks? On the one hand I can see the sector growing exponentially so it seems worthwhile looking for well run, sound companies, but on the other it still seems very volatile right now.

…..and here we are 2 weeks later….. So, buy now or keep holding for a bigger drop??

I don't suck from Apple's teat so I wouldn't buy their stock.

MR phil i listen to our podcast which very helpful. please can buy a good quality microphone, ur audio is hard to understand. is EBITA same as owners earnings if not can you make a video explaining in detail

My concerns as well, what happens if e.g one generation of iPhones is bad or a component becomes unavailable blocking the whole production chain

I think they are on sale now:)

Amazon is the first true global monster. It's the only one on your list of faang stocks that dominates multiple sectors. And we haven't even seen them get serious yet about their financial services and healthcare. Amazon is the company to invest in long term. Remember, this is a company that only a few short years ago wasn't making money. At around 1600 it's a great time to jump in long term.

Always wondered why it wasn't FAAMNG – 'M' being Microsoft of course

netflix is trash. way overyhyped

depends on which of these companies can create and push essential value to people. basically most useful innovators – will people finally get tired of a 'new' iphone. is facebook acquiring new companies make a difference to society. or will googles new self driving car trigger a revolution. the far thinking people and innovators in these companies matter on their future success.

Look for a 20 – 30% correction coming down the pipe. Invest in TECL (3x tech ETF) for 1 year of massive gains. Then move position into VGT for low cost tech index fund – thank me latter.

Hi, well researching Facebook through Phil Town Toolbox indicates that Facebook is below the margin of safety price!! Although the company is somewhat new with in a 10 year birth, is that enough of past numbers to crunch to pursue for investment?

Appl has averaged 50% return over the past 13 years…. it started 10 years after Steve Jobs returned and the iPhone was introduced.

$5k invested would be over $1M today.
Cut 5 years off that period and drop $50k in appl today!
Tom

This guy says index funds is bad and you should learn to invest, I bet he does not even perform better then index long term. Just trash talk. I want him to show me his average yearly return the last 15-20 years and stop with this bs. Evidence first then talking. He is not Warren Buffett and even Warren do have a hard time beating index in this fast changing world. You can not predict the future it gets harder and harder. So stop your bs and tell me you just want to earn money to invest in index funds,blue chip stocks with dividends or real estate from your bs content

I recently checked out the competitors around Google and I was surprised it doesn't have the best search algorithm of all. Will that other algorithm breach its moat? It surely did in some countries.