Market Overview

Pro: Why Alphabet Is A Better Pick Than Facebook

Pro: Why Alphabet Is A Better Pick Than Facebook
Related FB
Dan Nathan Sees Unusual Options Activity In Facebook
Tech Sector Earnings: Revenue Growth Widely Expected To Slow, Will Global Uncertainty Weigh?
Hot Options Report For End Of Day - Friday, Jan. 18 (TalkMarkets)
Related GOOG
Tech Sector Earnings: Revenue Growth Widely Expected To Slow, Will Global Uncertainty Weigh?
Another Day, Another Bank Misses On Earnings: Market Could Be On Defensive
FT: Spotify plans in-car voice-controlled music player (Seeking Alpha)

Shares of Facebook, Inc. (NASDAQ: FB) hit a new all-time high Wednesday and Alphabet Inc. (NASDAQ: GOOG) (NASDAQ: GOOGL)'s stock isn't far removed from its own peak. But if investors had to choose between the two stocks, they should consider Alphabet, according to Dan Niles.

The Expert

Niles, a founding partner at AlphaOne Capital Partners, discussed the Facebook vs. Alphabet debate Wednesday on CNBC.

The Thesis

Facebook remains in "pretty good shape" in the long run given the large number of social media users who are not monetized today or not monetized very well, Niles said. Facebook is making "no money" off the more than 1 billion WhatsApp users, and the 1.3 billion Messenger users are "barely" monetized, he said. 

Expectations for Facebook have risen ahead of Wednesday's earnings report, he said. In addition, the company faces risk from currency factors and management's prior guidance of expense growth in the 50-60 percent range, above the Street estimate of 47 percent.

In contrast, Alphabet exited its second-quarter report with strong performance, and in doing so may have pushed the bar higher for Facebook, Niles said. 

"We like Google better," he said. "That's our favorite in the internet space right now."

Price Action

Facebook shares were up 1.37 percent at the time of publication Wednesday at $217.61, while Alphabet was up 0.95 percent at $1,270.04.

Related Links:

Upcoming Earnings: Social Media In The Spotlight With Reports From Facebook And Twitter Ahead

Analyst: Negative Press, Privacy Scandal Won't Keep Facebook From Having A Solid Quarter

Latest Ratings for FB

Dec 2018Tigress FinancialReiteratesBuyBuy
Dec 2018GuggenheimInitiates Coverage OnNeutral
Dec 2018Stifel NicolausDowngradesBuyHold

View More Analyst Ratings for FB
View the Latest Analyst Ratings

Posted-In: AlphaOne Capital Partners Dan NilesAnalyst Color Analyst Ratings Media Best of Benzinga


Related Articles (GOOG + FB)

View Comments and Join the Discussion!

Latest Ratings

CNPRBC CapitalUpgrades34.0
View the Latest Analytics Ratings
Don't Miss Out!
Join Our Newsletter
Subscribe to:
Market in 5 Minutes
Everything you need to know about the market - quick & easy.
Daily Analyst Rating
A summary of each day’s top rating changes from sell-side analysts on the street.
Fintech Focus
Your weekly roundup of hot topics in the exciting world of fintech.
Thank You
for registering for Benzinga’s newsletters and alerts.
• The Daily Analysts Ratings email will be received daily between 7am and 10am.
• The Market in 5 Minutes email will be received daily between 7am and 8am.
• The Fintech Focus email will be received every Friday between 2pm and 5pm.

Q2 Earnings Preview For Bristol-Myers Squibb

A Preview Of AstraZeneca's Q2 Earnings