Analysts Bullish on These Disruptive E-Commerce Firms

Rising interest rates, high valuations, and a growing concern about a possible economic recession have led investors to be more skittish about technology stocks. Despite the surge in bond yields putting pressure on tech valuations, analysts from Citigroup have cited Amazon (NASDAQ:AMZN) and Airbnb (ABNB) as some of their top stock picks.

“Should a (mild) recession occur we believe its impacts are likely to be manageable,” Citigroup analyst Ronald Josey wrote in a note. “The broader sector is healthy as consumer engagement online continues to be more immersive and grow.”

Per Bloomberg, an online survey by Citi showed that people in the U.S. are more online than ever, with social media usage rising more than 67% from pre-pandemic levels and 43% of responders still using food delivery at least once a week.

Citi added that Airbnb should benefit from the ongoing recovery in travel demand, while Amazon is “best positioned” in e-commerce, online advertising, and cloud.

Amazon and Airbnb are currently two of the top holdings in the Franklin Disruptive Commerce ETF (BUYZ), which invests in companies benefitting from or facilitating advancements in emerging areas of the e-commerce space that enable more convenient, customized, secure, and time-efficient transactions for both consumers and businesses.

BUYZ is an actively managed fund that seeks to profit from companies that disrupt traditional commerce, such as online marketplaces and auctions, electronic payments, the sharing economy, or advances in shipping. The portfolio may include retailers, payment companies, logistics and delivery companies, and others. Many of its top holdings are likely to be found in any diversified equity fund. It is one of three actively managed thematic funds launched by Franklin Templeton in February 2020.

BUYZ has an expense ratio of 0.5%.

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