E-commerce and digital advertising spending will accelerate in 2024, setting up a strong year for Amazon shares, as well as… Meta platforms (dead), Uber (Uber) And Booking Holding (Baking), Wedbush analysts said Wednesday.
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Wedbush analysts outlined their top internet stock picks for 2024 in a note to clients, saying that while most internet stocks saw an overall decline in 2022 and entered this year facing uncertainty, they see a more optimistic picture in 2024.
“We expect more normal growth rates for e-commerce and digital advertising in 2024, with both industries positioned to accelerate next year,” a team of Wedbush analysts led by Scott Devitt wrote.
Amazon Stock: Top Pick for Ecommerce
Among the top picks, Wedbush sees the highest overall rise for Amazon (Amzn) stock. The company's 12-month price target of 210 pounds for Amazon shares – unchanged from last week's client note – suggests a 37% upside from Tuesday's closing price.
“Amazon is our top pick across our Internet coverage, and we believe the company is well positioned for 2024 as retail margins continue to rise, (Amazon Web Services) accelerates versus mitigating comps, and ad revenue growth continues to materially outperform broader digital advertising.” ” “Industry,” Devitt wrote.
Analysts at JPMorgan, Evercore ISI, TD Cowen and Bernstein, among others, have named Amazon stock as their top online pick for 2024.
Why does Meta Stock outperform Google?
Meanwhile, parent company Facebook Meta platforms (dead) is Wedbush's top choice in digital advertising. The report raised Wedbush's 12-month price target for Meta stock to $420, from 350. That implies an upside of just under 20% from Meta's closing price on Tuesday.
“Meta has driven user engagement across a variety of digital media, consistently improving monetization despite temporary industry headwinds related to user privacy and data transparency,” Devitt wrote.
Meta has gained nearly 200% this year as sales of its massive digital advertising business rebound. The stock fell 64% in 2022 amid slowing revenues.
Meta topped by Google's parent company the alphabet (Google) as the best choice for digital advertising. Next year “represents a relatively more challenging year for Google in our view, given the recent slowdown in Google Cloud, uncertainty related to AI initiatives, and the unknown impact that generative AI will have on search,” Wedbush analysts said.
However, Wedbush maintains the best possible Outperform rating on Meta and Alphabet stocks.
Uber Stock: The Race Ahead
Meanwhile, Uber is the top pick in Wedbush's online mobility category, and is ahead of it DoorDash (dash), Instacart (shopping cart) And Lyft (Lyft).
Furthermore, Uber stock carries an Outperform rating from Wedbush. The company's $67 price target for Uber implies a 9% upside from Tuesday's closing price.
“We believe Uber has built a highly defensible moat, and (about) 90% of Uber's total mobility bookings are generated in markets where Uber already holds the top spot in the category,” Devitt wrote.
Uber has gained nearly 150% this year. This summer, the company reported a first-quarter operating profit. Moreover, the company was added to the S&P 500 index earlier this month.
Finally, Booking Holdings is a top pick among online travel stocks. BKNG shares have “best-in-class margins” and a proven management team, Devitt wrote. Wedbush has an Outperform rating and a 3,850 price target on BKNG stock. This means an increase of 9% from Tuesday's closing price.
On the stock market today, Meta stock rose less than 1% to close at 357.83. Amazon shares traded flat to close at 153.34. Meanwhile, Uber rose 2.1% to close at 63.28 and BKNG lost 1% to close at 3,534.64.
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