Baird Picks Amazon, Meta, Zynga As Top Internet Picks For 2022
Internet investors remain primarily focused on shorter-term trends, near-term growth comps, and macro influences, rather than secular growth drivers, heading into 2022, Baird analyst Colin Sebastian tells.
Sebastian assumes that forward-year growth comps and margin trends will mainly drive near-term sentiment and less by the size of total addressable markets or secular growth themes.
With this in mind, Sebastian transitioned his large-cap pick from Alphabet Inc (NASDAQ: GOOG) (NASDAQ: GOOGL) to Amazon.com Inc (NASDAQ: AMZN) and Meta Platforms Inc (NASDAQ: FB).
Sebastian also changed his top small/mid-cap picks from ChannelAdvisor Corp (NYSE: ECOM), Carvana Co (NYSE: CVNA), and Take-Two Interactive Software Inc (NASDAQ: TTWO) to Zynga Inc (NASDAQ: ZNGA).
Additionally, Sebastian warmed to a few others, including Twitter Inc (NYSE: TWTR) and Vroom Inc (NASDAQ: VRM).
For Meta, Sebastian expects more positive commentary on core advertising trends in 2022.
On Amazon, he says the company is a crucial beneficiary of digital transformation and a mix shift towards recurring revenues.
For Zynga, Sebastian sees potential positive catalysts from easing Identifier for Advertisers headwinds and ramping monetization of new titles.
Price Action: AMZN shares traded higher by 0.20% at $3,420 in the premarket session on the last check Wednesday.
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Oct 2021 | RBC Capital | Maintains | Outperform | |
Oct 2021 | Mizuho | Maintains | Buy | |
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