Netflix, Inc. (NFLX), the undisputed king of the video streaming industry, is facing significant challenges such as stiff competition. So, in this article, I evaluated the fundamentals of three Internet stocks, eBay Inc. (EBAY), Meta Platform, Inc. (META) and Alphabet Inc. (GOOGLE), which could be a better portfolio addition than NFLX.
The streaming sector has seen explosive growth in recent years. As more and more market participants enter, NFLX’s dominant position is facing increasing challenges. Example: NFLX’s market share in the US dropped to 44.2% in the first quarter, marking a 6% decrease year-on-year. While it still leads the market, this decline underscores the growing competitiveness of the streaming landscape.
Additionally, although analysts expect NFLX revenue to grow 7.7% year-on-year in the third quarter (ending September 2023), it’s worth noting that the company failed to hit the mark. agreed revenue estimates for three of the last four quarters. very disappointing. Additionally, NFLX’s gross margin for the last 12 months was 38.77%, 21.5% lower than the industry average of 49.37%.
On the other hand, Internet usage continues to experience significant growth due to ongoing digitization and the widespread use of smartphones. In addition, the prospects of the internet industry are strengthened by the rapid development of Artificial Intelligence (AI) and the expansion of 5G connectivity.
At the beginning of the third quarter of 2023, approximately 5.19 billion people globally were using the Internet, making up 64.4% of the total global population. Furthermore, the number of global 5G connections is expected to exceed 1.90 billion by the end of the year. This forecast outlines an impressive trajectory, with projections showing 6.80 billion 5G connections globally by the end of 2027.
This represents an average annual growth of nearly a billion new connections, underscoring the significant scope and impact of the 5G technology landscape.
Considering all the above factors, EBAY, META and GOOGL can be proven to be better buy channels than NFLX to take advantage of favorable opportunities in the industry. To that end, let’s dive into the fundamentals of the three Internet industry selection, starting at number three.
Stock #3: eBay Inc. (EBAY)
EBAY operates marketplace platforms that connect buyers and sellers in the United States and internationally. The company’s marketplace platform includes the online marketplace at ebay.com and the eBay mobile app suite.
On July 11, EBAY successfully completed the acquisition of Certilogo, a Milan-based company specializing in AI-powered digital IDs and authentication for apparel and fashion products. Certilogo’s technology enables brands and designers to monitor the entire lifecycle of their clothing items and provides consumers with a convenient way to interact with fashion brands and items. their favorite.
By leveraging this acquisition, EBAY aims to provide brands with secure, interconnected, adaptive and interoperable product solutions.
On June 5, EBAY partnered with Techstars, a well-known pre-seed investor, to jointly launch a new accelerator program called “The Techstars E-Commerce Future Powered by eBay”. This program aims to support startups focused on developing innovative technologies that will play a key role in shaping the future of e-commerce.
EBAY’s final 12 month gross margin was 72.37%, 104.9% above the industry average of 35.32%. The company’s EBIT margin for the last 12 months was 24.48%, 225.3% higher than the industry average of 7.22%. Additionally, the stock’s 12-month leveraged FCF return is 27.82%, 447.9% above the industry average of 5.08%.
In terms of forward EV/EBIT, EBAY’s 8.89x is 34.1% below the industry average of 13.49x. In terms of non-GAAP forward P/E, the stock is trading at 10.57x, 28.5% below the industry average of 14.77x.
EBAY’s net sales for the second quarter (ending June 30, 2023) increased 4.9% year-on-year to $2.54 billion, while the company’s gross profit grew 3.6% over the same period to 1.82 billion USD. Additionally, its free cash flow reached $492 million, up 5.6% year over year.
Additionally, for the same period, the company’s net income was $172 million and $0.32 per share, respectively, compared with a net loss of $531 million and $0.95 per share, respectively. same period last year.
Analysts expect EBAY’s revenue for its fiscal third quarter (ending September 2023) to grow 4.9% year-on-year to $2.50 billion, while its EPS in same quarter is expected to be 1 USD. Furthermore, EPS is expected to improve by 8.3% annually over the next 5 years. Furthermore, the company has topped the revenue and EPS estimates for each of the last four quarters, a very impressive number.
Shares are up 6.8% year-to-date and closed their last trading session at $44.29.
‘s EBAY Rating POWR reflects this strong outlook. The stock has an overall B rating, converted to Buy in our proprietary rating system. The POWR Rating rates stocks according to 118 different factors, each with its own weight.
It has an A for Quality and a B for Growth. In 60 stocks Internet industry, it is ranked #10. Click here to see EBAY’s ratings for Value, Momentum, Stability and Sentiment.
Stock #2: Meta Platforms, Inc. (META)
Social media icon META is involved in developing products that allow people to connect and share with friends and family through mobile devices, PCs, virtual reality headsets and wearables all around the world. It operates in two segments: Application Pools and Practical Labs.
On July 18, META strengthened its long-standing partnership with Microsoft Corporation (MSFT) by choosing it as the preferred partner for Llama 2, an open source large language model freely available for research and commercial purposes. Access to Llama 2 is being facilitated with the support of various companies and individuals representing the technology, academic and policy sectors.
META’s final 12 month gross margin was 79.45%, 60.9% higher than the industry average of 49.37%. The last 12 months EBITDA margin was 37.27%, 101.5% higher than the industry average of 18.49%. Furthermore, the stock’s final 12-month net return was 18.71%, 353.1 percent higher than the industry average of 4.13%.
Additionally, META’s 1.05x non-GAAP PEG is 25.6% below the industry average of 1.41x.
For the second quarter ended June 30, 2023, META’s total revenue increased 11% year-on-year to $31.99 billion, while operating income increased 12.4% over price. value last year to $9.39 billion.
META’s net income and EPS amounted to $7.79 billion and $2.98, respectively, up 16.5% and 21.1% year over year. Additionally, its free cash flow stood at $10.95 billion, up 146.2 percent year-on-year.
The consensus revenue estimate of $33.34 billion for the third fiscal quarter (ending September 2023) represents a 20.3% increase year-over-year. The consensus EPS estimate of $3.55 for the current quarter represents a 116.4% improvement year-over-year. The company has an unexpectedly stellar history, beating consensus revenue estimates in each of the last four quarters.
Shares of META are up 149.4% year-to-date and closed the last session at $300.15.
META’s strong fundamentals are reflected in its POWR Rating. It has an overall rating of B, equivalent to Buy in our proprietary rating system.
It has an A for Quality and a B for Growth and Affection. In the same industry, it is ranked 7th. Click here to see other META ratings for Value, Momentum, and Stability.
Stock #1: Alphabet Inc. (GOOGLE)
Known for its pioneering internet-related products and services, GOOGL offers a wide variety of products and platforms internationally. It operates through Google Services; Google Cloud; and other Betting segments. Its services include Android, Chrome, hardware, Gmail, Google Drive, Google Maps, Google Photos, Google Play, Search, and YouTube.
The stock’s final 12-month net return was 21.05%, 409.9 percent above the industry average of 4.13%. The 12-month leveraged FCF margin is 23.57%, 194.5 percent above the industry average of 8.01%. Additionally, GOOGL’s 12-month ROCE was 23.33%, 466% higher than the industry average of 4.12%.
In terms of non-GAAP PEG futures, GOOGL’s 1.40x is slightly below the industry average of 1.41x.
For the second quarter ended June 30, 2023, GOOGL’s revenue grew 7.1% year-on-year to $74.60 billion. The company’s operating income came in at $21.84 billion, up 12.3% year-over-year.
The company’s net income and EPS increased 14.8% and 19% QoQ, respectively, to $18.37 billion and $1.44. Furthermore, its cash and cash equivalents amounted to $25.93 billion, up 32.2% from $21.88 billion on December 31, 2022.
Street expects GOOGL’s revenue and EPS for the third quarter (ending September 2023) to grow 9.4% and 34.9% year-over-year, respectively, to $75.59 billion and $1.43. billion USD.
Shares have gained 50.3% over the past six months and 53.9% so far to close the last trading session at $135.77.
It’s no surprise that GOOGL has an overall rating of B, equivalent to Buy in our proprietary rating system. It has a B for Affection and Quality. Out of 60 stocks in the same industry, it is ranked 6th.
In addition to the POWR Ratings we outlined above, we also have GOOGL ratings for Growth, Value, Momentum and Stability. Get all GOOGL . ratings This.
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GOOGL stock traded at $133.98 per share on Wednesday afternoon, down $1.79 (-1.32%). Year-to-date, GOOGL is up 51.85%, compared with a 17.22% gain for the benchmark S&P 500 index over the same period.
Author info: Anushka Mukherjee
Anushka’s ultimate aim is to equip investors with the necessary knowledge to help them make informed investment choices and achieve long-term sustainable financial prosperity. Than…
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GOOGL: 3 Internet Stocks BETTER THAN Netflix (NFLX) | StockNews.com
Netflix, Inc. (NFLX), the undisputed king of the video streaming industry, is facing significant challenges such as stiff competition. So, in this article, I evaluated the fundamentals of three Internet stocks, eBay Inc. (EBAY), Meta Platform, Inc. (META) and Alphabet Inc. (GOOGLE), which could be a better portfolio addition than NFLX.
The streaming sector has seen explosive growth in recent years. As more and more market participants enter, NFLX’s dominant position is facing increasing challenges. Example: NFLX’s market share in the US dropped to 44.2% in the first quarter, marking a 6% decrease year-on-year. While it still leads the market, this decline underscores the growing competitiveness of the streaming landscape.
Additionally, although analysts expect NFLX revenue to grow 7.7% year-on-year in the third quarter (ending September 2023), it’s worth noting that the company failed to hit the mark. agreed revenue estimates for three of the last four quarters. very disappointing. Additionally, NFLX’s gross margin for the last 12 months was 38.77%, 21.5% lower than the industry average of 49.37%.
On the other hand, Internet usage continues to experience significant growth due to ongoing digitization and the widespread use of smartphones. In addition, the prospects of the internet industry are strengthened by the rapid development of Artificial Intelligence (AI) and the expansion of 5G connectivity.
At the beginning of the third quarter of 2023, approximately 5.19 billion people globally were using the Internet, making up 64.4% of the total global population. Furthermore, the number of global 5G connections is expected to exceed 1.90 billion by the end of the year. This forecast outlines an impressive trajectory, with projections showing 6.80 billion 5G connections globally by the end of 2027.
This represents an average annual growth of nearly a billion new connections, underscoring the significant scope and impact of the 5G technology landscape.
Considering all the above factors, EBAY, META and GOOGL can be proven to be better buy channels than NFLX to take advantage of favorable opportunities in the industry. To that end, let’s dive into the fundamentals of the three Internet industry selection, starting at number three.
Stock #3: eBay Inc. (EBAY)
EBAY operates marketplace platforms that connect buyers and sellers in the United States and internationally. The company’s marketplace platform includes the online marketplace at ebay.com and the eBay mobile app suite.
On July 11, EBAY successfully completed the acquisition of Certilogo, a Milan-based company specializing in AI-powered digital IDs and authentication for apparel and fashion products. Certilogo’s technology enables brands and designers to monitor the entire lifecycle of their clothing items and provides consumers with a convenient way to interact with fashion brands and items. their favorite.
By leveraging this acquisition, EBAY aims to provide brands with secure, interconnected, adaptive and interoperable product solutions.
On June 5, EBAY partnered with Techstars, a well-known pre-seed investor, to jointly launch a new accelerator program called “The Techstars E-Commerce Future Powered by eBay”. This program aims to support startups focused on developing innovative technologies that will play a key role in shaping the future of e-commerce.
EBAY’s final 12 month gross margin was 72.37%, 104.9% above the industry average of 35.32%. The company’s EBIT margin for the last 12 months was 24.48%, 225.3% higher than the industry average of 7.22%. Additionally, the stock’s 12-month leveraged FCF return is 27.82%, 447.9% above the industry average of 5.08%.
In terms of forward EV/EBIT, EBAY’s 8.89x is 34.1% below the industry average of 13.49x. In terms of non-GAAP forward P/E, the stock is trading at 10.57x, 28.5% below the industry average of 14.77x.
EBAY’s net sales for the second quarter (ending June 30, 2023) increased 4.9% year-on-year to $2.54 billion, while the company’s gross profit grew 3.6% over the same period to 1.82 billion USD. Additionally, its free cash flow reached $492 million, up 5.6% year over year.
Additionally, for the same period, the company’s net income was $172 million and $0.32 per share, respectively, compared with a net loss of $531 million and $0.95 per share, respectively. same period last year.
Analysts expect EBAY’s revenue for its fiscal third quarter (ending September 2023) to grow 4.9% year-on-year to $2.50 billion, while its EPS in same quarter is expected to be 1 USD. Furthermore, EPS is expected to improve by 8.3% annually over the next 5 years. Furthermore, the company has topped the revenue and EPS estimates for each of the last four quarters, a very impressive number.
Shares are up 6.8% year-to-date and closed their last trading session at $44.29.
‘s EBAY Rating POWR reflects this strong outlook. The stock has an overall B rating, converted to Buy in our proprietary rating system. The POWR Rating rates stocks according to 118 different factors, each with its own weight.
It has an A for Quality and a B for Growth. In 60 stocks Internet industry, it is ranked #10. Click here to see EBAY’s ratings for Value, Momentum, Stability and Sentiment.
Stock #2: Meta Platforms, Inc. (META)
Social media icon META is involved in developing products that allow people to connect and share with friends and family through mobile devices, PCs, virtual reality headsets and wearables all around the world. It operates in two segments: Application Pools and Practical Labs.
On July 18, META strengthened its long-standing partnership with Microsoft Corporation (MSFT) by choosing it as the preferred partner for Llama 2, an open source large language model freely available for research and commercial purposes. Access to Llama 2 is being facilitated with the support of various companies and individuals representing the technology, academic and policy sectors.
META’s final 12 month gross margin was 79.45%, 60.9% higher than the industry average of 49.37%. The last 12 months EBITDA margin was 37.27%, 101.5% higher than the industry average of 18.49%. Furthermore, the stock’s final 12-month net return was 18.71%, 353.1 percent higher than the industry average of 4.13%.
Additionally, META’s 1.05x non-GAAP PEG is 25.6% below the industry average of 1.41x.
For the second quarter ended June 30, 2023, META’s total revenue increased 11% year-on-year to $31.99 billion, while operating income increased 12.4% over price. value last year to $9.39 billion.
META’s net income and EPS amounted to $7.79 billion and $2.98, respectively, up 16.5% and 21.1% year over year. Additionally, its free cash flow stood at $10.95 billion, up 146.2 percent year-on-year.
The consensus revenue estimate of $33.34 billion for the third fiscal quarter (ending September 2023) represents a 20.3% increase year-over-year. The consensus EPS estimate of $3.55 for the current quarter represents a 116.4% improvement year-over-year. The company has an unexpectedly stellar history, beating consensus revenue estimates in each of the last four quarters.
Shares of META are up 149.4% year-to-date and closed the last session at $300.15.
META’s strong fundamentals are reflected in its POWR Rating. It has an overall rating of B, equivalent to Buy in our proprietary rating system.
It has an A for Quality and a B for Growth and Affection. In the same industry, it is ranked 7th. Click here to see other META ratings for Value, Momentum, and Stability.
Stock #1: Alphabet Inc. (GOOGLE)
Known for its pioneering internet-related products and services, GOOGL offers a wide variety of products and platforms internationally. It operates through Google Services; Google Cloud; and other Betting segments. Its services include Android, Chrome, hardware, Gmail, Google Drive, Google Maps, Google Photos, Google Play, Search, and YouTube.
The stock’s final 12-month net return was 21.05%, 409.9 percent above the industry average of 4.13%. The 12-month leveraged FCF margin is 23.57%, 194.5 percent above the industry average of 8.01%. Additionally, GOOGL’s 12-month ROCE was 23.33%, 466% higher than the industry average of 4.12%.
In terms of non-GAAP PEG futures, GOOGL’s 1.40x is slightly below the industry average of 1.41x.
For the second quarter ended June 30, 2023, GOOGL’s revenue grew 7.1% year-on-year to $74.60 billion. The company’s operating income came in at $21.84 billion, up 12.3% year-over-year.
The company’s net income and EPS increased 14.8% and 19% QoQ, respectively, to $18.37 billion and $1.44. Furthermore, its cash and cash equivalents amounted to $25.93 billion, up 32.2% from $21.88 billion on December 31, 2022.
Street expects GOOGL’s revenue and EPS for the third quarter (ending September 2023) to grow 9.4% and 34.9% year-over-year, respectively, to $75.59 billion and $1.43. billion USD.
Shares have gained 50.3% over the past six months and 53.9% so far to close the last trading session at $135.77.
It’s no surprise that GOOGL has an overall rating of B, equivalent to Buy in our proprietary rating system. It has a B for Affection and Quality. Out of 60 stocks in the same industry, it is ranked 6th.
In addition to the POWR Ratings we outlined above, we also have GOOGL ratings for Growth, Value, Momentum and Stability. Get all GOOGL . ratings This.
What to do next?
Explore 10 widely held stocks that our proprietary modeling shows have huge downside potential. Make sure none of thesedeath trap“Stocks are lurking in your portfolio:
10 stocks to SELL NOW! >
GOOGL stock traded at $133.98 per share on Wednesday afternoon, down $1.79 (-1.32%). Year-to-date, GOOGL is up 51.85%, compared with a 17.22% gain for the benchmark S&P 500 index over the same period.
Author info: Anushka Mukherjee
Anushka’s ultimate aim is to equip investors with the necessary knowledge to help them make informed investment choices and achieve long-term sustainable financial prosperity. Than…
More resources for stocks in this article
#GOOGL #Internet #Stocks #Netflix #NFLX #StockNews.com
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