Written by Sinad Karahimetovic
Bank of America reiterated the company’s positive stance on Alphabet (NASDAQ 🙂 (NASDAQ: and Meta Platforms (NASDAQ :)), which Bank of America continues to see as the most valuable stock in the internet sector.
However, Bank of America acknowledges that Street’s estimate of Alphabet/Meta ad revenue is likely to be very high for 2023. Moreover, increased competition from TikTok and AVOD could reap more than $5 billion in industry growth.
As a result, the bank lowered its estimates on GOOGL and META to reflect a mild slump and headwinds in the FX market. These cut-off estimates are then reflected in – $196 per share on META stock and $114 on GOOGL stock.
On the other hand, EPS is expected to prove more resilient due to cost cutting activities.
“While the 2023 advertising revenue outlook has deteriorated over the past six months, we believe negative sentiment and lower valuations make the investment background more attractive, monetization from Alphabet’s Performance Max and Meta Reels could be an important revenue driver in 2023,” Bank of America said in Customer note.
See more stats about Meta and Alphabet here.