After a profitable and eventful year for Apple Inc. (NASDAQ:AAPL), Facebook Inc (NASDAQ:FB), and Amazon.com, Inc. (NASDAQ:AMZN), each has plans to keep the momentum going for 2016:
As a technology leader, Apple is looking for more ways to stay on top in 2016. The company is planning to expand its Apple Pay platform to several countries, including China, Singapore, Australia, and Canada. The company believes its brand recognition will lead to a successful launch in these countries. Apple is anticipating particular success in China thanks to its partnership with bank-card association UnionPay, which will allow for easier entry into the Chinese market. Other plans for 2016 include the launch of a streaming TV service and the iPhone 7, the latter expected in September.
On October 30, 2015, analyst Daniel Ives of FBR Capital weighed in on Apple and its future, reiterating an Outperform rating for the company and a price target of $170. Ives points to the iPhone 6s’s product cycle, the company’s strong foothold in the Chinese market, and new product releases as strengths going into 2016. He predicts “white-hot growth [for China] with a $100 billion market opportunity ahead for the next 3 years.” According to TipRanks‘ statistics, 33 analysts weighed in on the company in the last 3 months, of which 27 gave a Buy rating while 8 remain on the sidelines. The average 12-month price target for the stock is $146.48, marking a 33% potential upside from where shares last closed.
Facebook also has a bright outlook for 2016. Analyst Gene Munster of Piper Jaffray maintains a positive outlook on the company, particularly due to the anticipated 2016 release of its virtual reality platform Oculus Rift. On December 16, 2015, the analyst reiterated his Overweight rating on the stock with a price target of $155, pointing to Oculus Rift as the product is the first of its kind in the category. Although Munster expects slow initial demand for the virtual reality platform, he “[sees] compelling VR content starting to emerge with Millennials and Generation Z.” Munster is ranked #2 out of 3,714 analysts on TipRanks with a 63% success rate recommending stocks and an average return of 22.5% per recommendation.
Separately, analyst William Bird of FBR Capital also weighed in on the social media giant on December 22, 2015, reiterating his Buy rating on the company with a $125 price target. Bird believes the company will take advantage of various opportunities given its positioning and product profile. Most notably, the analyst believes mobile ads, especially for Facebook owned Instagram, will lead to substantial revenue in 2016. For Instagram, Bird “[believes] revenue potential could approach $5 billion on its current user base, which continues to grow.”
Amazon is another company with a bright future. This past year, the company significantly increased its Prime memberships, added original content to its Prime Video streaming service, and introduced its Prime Now membership, with immediate delivery options. The company also grew its cloud service (AWS) by introducing AWS IoT, to connect cars, medical devices, and appliances to its servers.
Analyst Justin Post of Merrill Lynch weighed in on the company going into 2016. On December 17, 2015 the analyst maintained a Buy rating on Amazon and raised his price target to $775 from $740, citing the company’s e-commerce and AWS growth as particular strengths. Post expects Prime Memberships to reach 70 million in 2016, creating an “eCommerce customer lock in” for the company. He believes Amazon’s AWS segment is 2015’s “best growth story” within the industry and expects margin growth of 25% in 2016 and 2017. The analyst has a 71% success rate recommending stocks with a 21.8% return per recommendation.