Two FAANG stocks I would avoid. Here is why
There are various reasons why to avoid specific stocks over others out of the thousands of listed companies. However, I will be focusing on FAANG stocks. More specifically, Facebook, Apple, Amazon, Netflix, and Google.
Out of the bunch, two names, in particular, are worth sounding the alarm on. Facebook and Apple are both companies that are facing some worry either on valuation, fundamentals, or competition.
Facebook (NASDAQ: FB)
Facebook, the social media giant that influences a massive portion of the population, has had its stock decline on an abundance of problems. Everything from competition to whistleblowers, Facebook is getting targeted. Their $1 trillion market capitalization has now been wiped, down near $910 billion.
Despite Facebook (NASDAQ:FB) being a growth stock, growing over 20% in the past year alone, the stock has plummeted for a variety of reasons. These reasons aren’t invalid, they can affect Facebook’s long-term success.
One of the main reasons for worry is the competition with TikTok. Facebook over the past few years has become the ‘everything’ app. It all started with Stories, then IGTV, and Reels. These products were released to compete against Snapchat, Youtube, and TikTok. However, in doing so it has made their service very cluttered. These other corporations are eating away at Facebook’s long-term potential as they have mastered their genre in the social media industry, while Facebook struggles to find its purpose.
Another reason for potentially steering clear from Facebook is the shady business model in which it operates. Just recently, a whistleblower who was a formal product manager at Facebook had admitted they were behind multiple leaks involving a toxic online environment for teenagers that Facebook has built over the years of operating.