CRT's Doshi Starts Amazon, Google, Facebook, LinkedIn at Buy, Netflix, AOL, Yahoo!, Pandora, Yelp, Zillow at Fairly Valued
Analyst Neil Doshi from CRT Capital published notes on stocks in the Internet and Interactive Media space Thursday morning.
- Amazon (NASDAQ: AMZN) - $350 price target. The analyst noted “Amazon has one of the strongest fundamentals in the Internet sector” and “continues to invest heavily in building its infrastructure, and developing new products and services”.
- Google (NASDAQ: GOOG) - $1,090 target. Doshi believes “GOOG shares are poised for solid returns over the next 12 months as the Company should continue taking share in Mobile, Display, and Search advertising. Furthermore, we believe 2H:13 could yield pricing tailwinds as GOOG anniversaries changes made to Partner Sites, and should experience a lift in Costs Per Clicks."
- Facebook (NASDAQ: FB) - $52 target. Doshi sees 15 percent upside over the next year and reviewed Facebook's success as a mobile firm.
- LinkedIn Corporation (NYSE: LNKD) - $302 target. Reviewed LinkedIn as the largest professional social network and noted that it ranked at the top in Capital Group's SaaS Audience MAP framework. Doshi applauded LNKD on their strong long-term business model and their new products.
Fairly Valued Rated:
- AOL Inc (NYSE: AOL) - noted the increase in subscription revenue. Doshi was disappointed in AOL's Mobile MAP framework, the programmatic displays, and uncertainties with Patch. Sees full valuation at five times 2014 EV/EBITDA.
- Netflix, Inc. (NASDAQ: NFLX) - Remains a dominant force in television and online video. The analyst informed investors that NFLX should surpass HBO subscriptions in 2014 and “expect domestic streaming contribution margins to go from 17% in 2012 to 28% in 2015.”
- Pandora Media Inc. (NYSE: P) - Competing with iTunes, “is entering heavy investment mode to build out its local ad sales force and invest in product”.
- Yahoo! Inc.'s (NASDAQ: YHOO) - Disappointed with Mobile MAP and Online Video Map, Doshi gave YHOO a Fair Value rating. The analyst noted that the increase of shares from the liquidity of YHOO's stake in Alibaba is currently priced in, and viewed the company's core operations as “challenged”.
- Yelp, Inc. (NYSE: YELP) - Doshi wrote, “In our view, Yelp is the leading independent provider of local business information and customer reviews, and is likely to remain a key beneficiary of the shift of local/ SMB advertising budgets to the Internet.” Despite the praise, YELP has a high valuation and many risks.
- Zillow, Inc. (NASDAQ: Z) - Doshi noted a balance of risk-reward. The analyst highly valued Z's user base and aggressive expansion, but thought the approximately 74 times 2014 EV/ EBITDA has already balanced the equation.
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