Bulletin
Investor Alert

New York Markets After Hours

The Ratings Game Archives | Email alerts

Sept. 13, 2021, 12:35 p.m. EDT

Here are two large tech stocks to avoid, according to Goldman Sachs

new
Watchlist Relevance
LEARN MORE

Want to see how this story relates to your watchlist?

Just add items to create a watchlist now:

  • X
    Airbnb Inc. Cl A (ABNB)
  • X
    Twitter Inc. (TWTR)
  • X
    Amazon.com Inc. (AMZN)

or Cancel Already have a watchlist? Log In

By Emily Bary

There’s still some opportunity among large-cap internet stocks, but investors should steer clear of two names, according to Goldman Sachs.

Goldman’s Eric Sheridan initiated coverage of 17 larger-capitalization internet stocks late Sunday and assigned sell ratings to Airbnb Inc. /zigman2/quotes/222990650/composite ABNB +0.44% and Twitter Inc. /zigman2/quotes/203180645/composite TWTR -0.59% shares. Airbnb’s stock is off 2.8% in Monday trading, while Twitter’s is down 3.4%.

While Sheridan expects that Airbnb will continue to outgrow the broader online travel industry over the next five years, he sees a negative risk-reward balance on the stock.

Sheridan wrote that investors seem to have high conviction that Airbnb will benefit from a “new normal” for travel given the emergence of more flexible work/life structures, meaning that they would be able to travel more freely and spend more time at their destinations. But he’s “not yet convinced of that outcome having a high probability” and argues that significant investor optimism about this dynamic is already priced into Airbnb’s stock.

He set a $132 price target on the stock, which changed hands just above $160 as of midday Monday.

Sheridan also worries about the risk/reward trade-off on Twitter, writing that he thinks the advertising recovery is priced into the shares.

Another key issue for Twitter is whether the company can successfully use new features like audio rooms, newsletters, and tip jars to boost engagement and monetization. Twitter has been increasing the pace of feature introductions recently after gaining a reputation for being slow on innovation, but “the probability of success of these platform evolutions remains an open question,” Sheridan wrote.

He set a $60 price target for the stock, which recently changed hands at $59.44.

Sheridan was more upbeat on other elements of the internet universe, assigning buy ratings to shares of Amazon.com Inc. /zigman2/quotes/210331248/composite AMZN +0.58% , Facebook Inc. /zigman2/quotes/205064656/composite FB +0.32% , Alphabet Inc. /zigman2/quotes/205453964/composite GOOG +0.26% /zigman2/quotes/202490156/composite GOOGL +0.08% , Snap Inc. /zigman2/quotes/205087158/composite SNAP -0.70% , Uber Technologies Inc. /zigman2/quotes/211348248/composite UBER +0.98% , Lyft Inc. /zigman2/quotes/208999293/composite LYFT +0.32% , and Expedia Group Inc. /zigman2/quotes/202291990/composite EXPE -0.60%

He is neutral on shares of Pinterest Inc. /zigman2/quotes/211319641/composite PINS -2.11% , Chewy Inc. /zigman2/quotes/212690528/composite CHWY -0.56% , Netflix Inc. /zigman2/quotes/202353025/composite NFLX +4.48% , Peloton Interactive Inc. /zigman2/quotes/208035743/composite PTON +4.61% , Spotify Technology SA /zigman2/quotes/207488629/composite SPOT +1.52% , Booking Holdings Inc. /zigman2/quotes/203576210/composite BKNG +1.13% , and DoorDash Inc. /zigman2/quotes/222973991/composite DASH +1.45%

/zigman2/quotes/222990650/composite
US : U.S.: Nasdaq
$ 170.50
+0.74 +0.44%
Volume: 2.99M
Oct. 21, 2021 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$106.72 billion
Rev. per Employee
$603,573
loading...
/zigman2/quotes/203180645/composite
US : U.S.: NYSE
$ 65.41
-0.39 -0.59%
Volume: 7.73M
Oct. 21, 2021 4:00p
P/E Ratio
140.46
Dividend Yield
N/A
Market Cap
$52.51 billion
Rev. per Employee
$675,700
loading...
/zigman2/quotes/210331248/composite
US : U.S.: Nasdaq
$ 3,435.01
+19.95 +0.58%
Volume: 1.73M
Oct. 21, 2021 4:00p
P/E Ratio
59.82
Dividend Yield
N/A
Market Cap
$1729.52 billion
Rev. per Employee
$297,430
loading...
/zigman2/quotes/205064656/composite
US : U.S.: Nasdaq
$ 341.88
+1.10 +0.32%
Volume: 11.04M
Oct. 21, 2021 4:00p
P/E Ratio
25.27
Dividend Yield
N/A
Market Cap
$960.81 billion
Rev. per Employee
$1.47M
loading...
/zigman2/quotes/205453964/composite
US : U.S.: Nasdaq
$ 2,855.61
+7.31 +0.26%
Volume: 680,811
Oct. 21, 2021 4:00p
P/E Ratio
30.92
Dividend Yield
N/A
Market Cap
$1894.64 billion
Rev. per Employee
$1.35M
loading...
/zigman2/quotes/202490156/composite
US : U.S.: Nasdaq
$ 2,837.72
+2.34 +0.08%
Volume: 1.09M
Oct. 21, 2021 4:00p
P/E Ratio
30.72
Dividend Yield
N/A
Market Cap
$1894.64 billion
Rev. per Employee
$1.35M
loading...
/zigman2/quotes/205087158/composite
US : U.S.: NYSE
$ 75.12
-0.53 -0.70%
Volume: 16.61M
Oct. 21, 2021 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$119.61 billion
Rev. per Employee
$648,881
loading...
/zigman2/quotes/211348248/composite
US : U.S.: NYSE
$ 46.45
+0.45 +0.98%
Volume: 14.30M
Oct. 21, 2021 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$89.14 billion
Rev. per Employee
$488,553
loading...
/zigman2/quotes/208999293/composite
US : U.S.: Nasdaq
$ 49.57
+0.16 +0.32%
Volume: 3.96M
Oct. 21, 2021 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$16.57 billion
Rev. per Employee
$505,814
loading...
/zigman2/quotes/202291990/composite
US : U.S.: Nasdaq
$ 162.75
-0.98 -0.60%
Volume: 2.08M
Oct. 21, 2021 4:00p
P/E Ratio
N/A
Dividend Yield
0.00%
Market Cap
$24.69 billion
Rev. per Employee
$272,199
loading...
/zigman2/quotes/211319641/composite
US : U.S.: NYSE
$ 61.36
-1.32 -2.11%
Volume: 26.00M
Oct. 21, 2021 4:00p
P/E Ratio
290.39
Dividend Yield
N/A
Market Cap
$40.41 billion
Rev. per Employee
$665,092
loading...
/zigman2/quotes/212690528/composite
US : U.S.: NYSE
$ 65.53
-0.37 -0.56%
Volume: 1.86M
Oct. 21, 2021 4:00p
P/E Ratio
3,361
Dividend Yield
N/A
Market Cap
$27.53 billion
Rev. per Employee
$386,285
loading...
/zigman2/quotes/202353025/composite
US : U.S.: Nasdaq
$ 653.16
+28.02 +4.48%
Volume: 8.19M
Oct. 21, 2021 4:00p
P/E Ratio
58.72
Dividend Yield
N/A
Market Cap
$276.68 billion
Rev. per Employee
$2.66M
loading...
/zigman2/quotes/208035743/composite
US : U.S.: Nasdaq
$ 94.83
+4.18 +4.61%
Volume: 6.98M
Oct. 21, 2021 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$27.24 billion
Rev. per Employee
$464,304
loading...
/zigman2/quotes/207488629/composite
US : U.S.: NYSE
$ 254.99
+3.81 +1.52%
Volume: 973,065
Oct. 21, 2021 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$47.11 billion
Rev. per Employee
N/A
loading...
/zigman2/quotes/203576210/composite
US : U.S.: Nasdaq
$ 2,411.13
+26.95 +1.13%
Volume: 190,831
Oct. 21, 2021 4:00p
P/E Ratio
239.64
Dividend Yield
N/A
Market Cap
$97.89 billion
Rev. per Employee
$334,778
loading...
/zigman2/quotes/222973991/composite
US : U.S.: NYSE
$ 218.80
+3.12 +1.45%
Volume: 739,511
Oct. 21, 2021 4:00p
P/E Ratio
N/A
Dividend Yield
N/A
Market Cap
$72.89 billion
Rev. per Employee
$742,666
loading...

This Story has 0 Comments
Be the first to comment
More News In
Industries

Story Conversation

Commenting FAQs »

Partner Center

Link to MarketWatch's Slice.