Club names Alphabet, Meta Platforms and Amazon are best positioned to dominate the online advertising landscape this year, according to a new Wall Street survey. The results confirm our bullish stance on these three Big Tech giants. Based on responses from the latest survey of US ad buyers, analysts at TD Cowen said on Tuesday they believe Google parent Alphabet can maintain its lead in digital advertising. They added that YouTube should be able to get incremental shares this year. A survey conducted at the end of last year to measure advertising trends for 2024 found that advertisers are favoring Google Search for several reasons, most notably because the platform provides the highest return on investment. According to research by Cowen, Google Search was the platform of choice for ad buyers for its best-in-class measurement and generative AI tools. Analysts expect Alphabet’s fourth-quarter gross revenue to rise 12.8% year over year to $85.8 billion. The company raised its target price on the stock to $170 per share from $155 and reiterated its outperform-equivalent rating to buy. GOOGL 5Y mountain Alphabet 5 years Jim Cramer saw major strength on Tuesday and was also bullish on Alphabet stock from a technical standpoint. “Alphabet may be poised for another move” higher, based on what he called “one of the biggest charts” in a long time. The stock is quietly pushing toward its November 2021 all-time high of nearly $150 per share. Shares closed 1.5% higher at nearly $141 apiece in Tuesday’s session. We’re excited about YouTube becoming the home of NFL Sunday Ticket this season. Advertising is how Alphabet makes most of its money. YouTube and Google Search ad revenue were better than expected in the third quarter. The dominance of advertising is one of the reasons we stay with Alphabet stock. We also like what we’re seeing from Alphabet’s growing services segment, the recurring sales that investors have come to expect from tech giants lately. Google Cloud revenue beat estimates in Q3 — during a period when rival Microsoft and its Azure cloud showed strength. However, at the time of the release in late October, we cautioned against being too bearish on Alphabet stock due to cloud softness, as some of the weakness could be attributed to continued spending on optimization efforts. Out of discipline after last year’s 57% gain, we downgraded Alphabet on January 2nd. We also made small sales in five other Magnificent Seven stocks we own, including Meta and Amazon. META 1Y mountain Meta Platforms 1 year Cowen’s survey, which collected responses from 54 senior US ad buyers who advertise on digital and traditional ad platforms, also found a preference for short-form video service Reels – Meta’s answer to TikTok. Meta’s focus on Reels growth should help the company capture an ever-increasing share of the business,” the analysts said. They forecast Meta’s total revenue to grow 11.9% to $150.1 billion in fiscal 2024. Meta’s advertising game is strong . Jim sees Instagram as the “best buy” on the Internet. We just hope CEO Mark Zuckerberg tries to minimize spending on the money-losing metaverse. AMZN YTD mountain Amazon 1 year Taps Amazon, 39% of Cowen survey respondents expect e-commerce and the cloud giant to “emerge as a meaningful advertising platform.” Ad buyers have indicated their interest in advertising on Prime Video in 2024. Of advertisers already spending on Amazon, 43% plan to increase spending on the platform this year as they shift their spending elsewhere from TV budgets and other digital platforms.As Amazon is an e-commerce giant with over 200 million Prime subscribers, we’re sure the company’s advertising business can compete with other large-cap tech players. We also like the building from faster e-commerce delivery, the re-acceleration of its Amazon Web Services cloud division and continued cost optimization efforts. (Jim Cramer’s Charitable Trust is long GOOGL, META, MSFT, AMZN. Here’s a full list of stocks.) As a CNBC Investing Club with Jim Cramer subscriber, you’ll receive trade alerts before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling shares in his charitable trust’s portfolio. If Jim was talking about stocks on CNBC TV, he waits 72 hours after the trade alert is issued before he executes the trade. THE ABOVE INVESTMENT CLUB INFORMATION IS SUBJECT TO OUR TERMS AND PRIVACY POLICY ALONG WITH OUR DISCLAIMER. NO FIDUCIARY OBLIGATION SHALL EXIST OR CREATE BY YOUR ACCEPTANCE OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTMENT CLUB. NO PARTICULAR RESULT OR PROFIT IS GUARANTEED.
The exterior of Google’s new headquarters is seen at 550 Washington Street in Hudson Square on January 9, 2024 in New York City.
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Club names Alphabet, meta platform, and Amazon are best positioned to dominate the online advertising landscape this year, according to a new Wall Street survey.
The results confirm our bullish stance on these three Big Tech giants.