Amazon and Facebook Bulls Cling to Buys Amid Negative-News FloodBy
Analysts hold steady with more than 40 buy ratings for each
Wall Street sees the buying opportunity outweighing concerns
When a stock falls seven percent in four trading days, or 16 percent in two weeks, it usually prompts some negativity -- if not a downgrade or two -- from Wall Street. Not so for Amazon.com Inc. and Facebook Inc.
The companies have been defended by numerous firms in the wake of their respective share-price declines: Amazon’s spurred by a series of criticisms from President Donald Trump and Facebook amid its ongoing user-data crisis. Both internet giants have more than 44 buy or equivalent ratings among analysts tracked by Bloomberg. Amazon has one sell rating, while Facebook has two.
Loop Capital analyst Anthony Chukumba joined analysts including Piper Jaffray, Evercore ISI and D.A. Davidson in defending Amazon on Wednesday, saying Trump’s tweets are “unlikely to result in any serious long-term ramifications,” and that the pullback has created a buying opportunity. Some Facebook analysts have been slightly more cautious, with price-target cuts from Morgan Stanley and Deutsche Bank. Still, the user-data scandal hasn’t resulted in any downgrades, while Morgan Stanley’s Brian Nowak said he is still positive overall about Facebook after recent checks with advertisers.
For Amazon, Wall Street bullishness -- along with a Bloomberg report that the Trump administration is not actively seeking to act on the president’s tweets -- seems to be helping curb declines for now.
Positive Facebook analysts may be waiting to see what happens later this month. Chief Executive Officer Mark Zuckerberg has been invited to testify before the U.S. Senate Judiciary Committee on April 10, while two other Congressional committees also have invited Zuckerberg to testify.