FAANG stocks take a breather

Investing


It’s been a tough week for the FAANG stocks — though a few bounced back today. Facebook, Apple, Amazon, Netflix and Google parent Alphabet are all down for the week, anywhere from roughly 1 percent to 4 percent.

That doesn’t sound like much, but when you’re dealing with this group, you’re in the biggest league of them all in terms of market capitalization. When they move, they move indexes, and they can make, and lose, a lot of money for investors. Apple, Facebook, Google and Amazon were four of the five biggest negative drags on the S&P 500 this week.

Let me show you what I’m talking about. Collectively, the five FAANG stocks had a market capitalization of about $2.8 trillion at the end of last week. The entire value of the U.S. stock market was about $28 trillion, meaning the FAANG stocks were about 10 percent of the market cap of the entire stock market.

FAANG vs. the market (market capitalization)

FAANG stocks: $2.8 trillion

U.S. market capitalization $28 trillion

But this week the total market value of the FAANG stocks dropped to about $2.75 trillion, a loss of about $60 billion in market cap. Facebook and Apple alone are down about $17 billion each, followed by Google at nearly $15 billion, and Amazon and Netflix with smaller declines.

FAANG Market cap declines (this week)

Facebook $17.8 billion

Apple $17.7 billion

Google $14.7 billion

Amazon $6.6 billion

Netflix $3.1 billion

Total: $60.0 billion

The good news is that this group stabilized on Thursday. And for the year, they are all up, as much as 56 percent for Amazon and 32 percent for Alphabet. Four have at least doubled and in some cases tripled the S&P 500’s 18 percent gain. It will be interesting to see how much longer can that continue, even with outsized revenue growth.

FAANG stocks this year

Amazon up 56 percent

Facebook up 53 percent

Netflix up 51 percent

Apple up 49 percent

Google up 32 percent



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