Tech investor Paul Meeks says the FAANG stock he will now steer clear of despite recent trends in the broader sector, says the company’s business divisions “could be in for some trouble. ” That company is e-commerce giant Amazon, whose stock is down more than 30% so far this year as of late Thursday. Meeks, portfolio manager at Independent Solutions Wealth Management, told CNBC’s “Street Signs Asia” on Thursday. “I would stay away from that stock because of the big expenses and slowing revenue,” he said. The best thing about that company is Amazon Web Services. That’s okay but man, I really think the e-commerce business could be in for some trouble.” At the end of April, Amazon released a revenue forecast that was lower than expected by analysts. analyzed and reported its slowest quarterly growth since the dot-com bust in 2001. Among the Big Tech, Meeks considers Apple, Alphabet, Google’s parent company, and Microsoft to be the only companies that he “could really be satisfied right now.” Independent Solutions Wealth Management owns shares in those companies, while shares of Facebook’s parent Meta Platform may have fallen more than 40% so far. This year and looking attractive at current levels, Meeks expressed skepticism about the company’s future due to disruptions in the digital advertising industry. Reports make up a large portion of Meta’s revenue, with more than 95 percent. Shares of social media companies and digital advertising firms fell on Tuesday after Snap warned against threats. invest that it will fall short of its previous targets for adjusted revenue and earnings for the current quarter. “The interesting thing about that whole space, those models of digital advertising… wouldn’t say they were in permanent decline but they were disrupted,” he said. “I don’t know what Meta’s business model will be in the future. The spending is huge on the metaverse, and I don’t even know if they even know what that is.” Meta Reality Labs, a division of the company trying to build products for the metaverse, lost nearly $3 billion in the first quarter. In February, Meta’s Chief Financial Officer said during an earnings call that he expects operating losses to “meaningfully increase” in 2022. Cybersecurity Optimism Elsewhere In the technology sector, Meeks said cybersecurity is an industry that can “accelerate growth” despite geopolitical difficulties. The investor said he likes Palo Alto Networks, which recently raised its full-year forecast after it posted third-quarter financial results that beat analysts’ best expectations. “I expect even greater greatness from this company,” Meeks said. “This company isn’t particularly cheap, but I’m very comforted that they will be able to continue to grow and last quarter they grew 40%.”
Tech investor Paul Meeks says the FAANG stock he will now steer clear of despite recent trends in the broader sector, says the company’s business divisions “could be in for some trouble. “
