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Topeka Capital Markets analyst Victor Anthony on the stocks Internet investors should consider, and avoid, this year.
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It's botched IPOs to come from behind winners Internet investors -- -- of chilly choppy ride last year but now we've got an analyst here with three Internet stocks he says.
Are screaming buys in the new year joining me now.
Victor Anthony of Topeka capital markets he's there Internet -- -- also some losers that you think people really need to stay away from we'll get to those in just a minute but -- own get right to these names.
Because even -- sectors always been very alluring and sexy to a lot of people but FaceBook.
Freely through people for a lupus as of course what happened to be a botched IPO.
The really drew attention away from for what has been an unbelievably successful start -- a company all the way threat right so you love this now why.
I've always loved it clearly they've had a tumultuous here but I think now.
Two biggest their concerns and stock which is mobile monetization or a lack thereof.
And a lock ups are behind -- company.
So now they have a clear path to was my position 2013 meaning they will figure out a way to make a lot of money from the mobile because everybody's using their Smartphones now to check -- Facebook's except me because I'm with the bank and a yeah I think mobile monetization -- be a big story for them in 2014.
And I'm down to those 2013 as wells as fourteen.
-- -- roughly 50% total -- revenues fifty.
Coming from.
Mobile.
Over the next we -- -- you really believe people will click on mobile labs or they'll see those mobile -- enough that that FaceBook saying to companies -- gonna charge you for about what yet there's the multiple different arguments on the company's launch sponsor series.
Mobile -- units what's which understands -- Well look -- developers to suggest the post promoted polls.
The consumers a lot of warm temperatures up conductor with people actually use FaceBook take -- off my investment -- the second.
They don't even know that it -- reckoned with and that that's how good of a placement at those ads are -- part of the content.
And so not only other part of the content is also socially relevant so it's you see an impact that a friend of yours but you may have in mind at some point.
Put on of intractable point with in the past so this relevancy president -- I.
That's sort of the Google -- the -- Google model alert right it just quickly touch upon against a gram which.
FaceBook owns that stumbled with with some privacy policy announcements of people absolutely hated and started dumping out of mr.
Graham.
Will they figure that out will they make -- figure out a way to monetize instead grabbed.
Yeah I think put out annoying people that dust up about -- is clearly the state at -- behind him now.
I think in 2013 this here you'll see FaceBook look to monetize.
Mr.
Graham.
My quick back of the envelope around calculations -- seem roughly.
250 million dollars in revenues in the first full year at roughly 50% of ebitda margins so is going to be strong catalyst for FaceBook in 2000.
Clicks off from selling might -- eleven -- pictures stuffing now OK all right let me get to your next pick and that is Amazon Amazon yes.
I I said I am eternally surprised by people pick this because.
The price earnings ratio of the valuation is crazy of me in the trailing PE ready for this 3000 to eighty okay have been -- -- -- that really sustainable.
What a look at Amazon was followed look at sort of my -- -- just -- 2000 there's is roughly -- fifty times.
And the -- -- look at is really on a peg ratio so sort of -- growth expectations -- I'm seem roughly 50% growth.
For Amazon over the next -- -- -- a buy stuff on Amazon and I'm an Amazon prime member but I just look at this and I wonder.
The stock did very nicely over the past year I think up about what 44%.
Right -- it.
Mimic them.
I'm seen the stock appreciated 35% in 2000 and thirteen -- headline.
So clothes for small -- solicit stock to -- everyone is -- for growth investors value vs.
We'll just never -- the stock and that's fine.
This -- -- book and this is either on the stock and all the time I think the stock or rationalize and it.
To valuation rationalize -- come -- -- A level weapons arguments is about a stocks at the Kindle fire what is it I'm back OK so the first thing I think 2013 to fourteen would be a much an expansion if Amazon.
Hi Vanessa -- led by expansion in gross margins that's going to be led by eleven to fulfillment expenses.
-- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- -- stock price has appreciated significantly and I see the same thing happening again coming off this recent investment cycle that there on right now.
So we've got FaceBook we've got Amazon your third pick is IE AC and Barry -- company -- -- regular company.
Which you guys should be intimately.
It anyway if you're -- so he helped found.
Right public discovered is that what my topics.
I think it's a perfect blend of growth and value.
A unique.
Combination Internet space.
And so.
When I look at -- stock massive stock -- trade at a significant discount.
-- growth expectations.
It's the most and about a stock -- coverage universe.
Brought to the growth that's what it's not a lot of companies under its umbrella which ones do you think will be the real driver well I think the growth it was -- is really driven by match dot com.
Which is I'm going through a secular.
A performance phase led by horizon singles market led by -- people -- comfortable posting personal information online and that's really let -- social media.
And also the tree down and economy helping it's a cheap way -- opponent to tend to want to meet someone.
Okay you have to losers let's go through them quickly number well I don't -- it loses I just wanna step into stocks and on how to appreciate it.
And what I'm by the way it was a huge performer over 2012 and at a sale well yes -- -- -- one of the -- performance.
If not.
More than a 100% to the upside I also got Bankrate why do you think that these you're not the winners of twenty for Roswell incident management team -- the two companies solitude council MR struck a vegetarian Tom Evans a great about having great.
However I think there was a company's degenerate wrapped to -- monetization of -- Much is this levels -- to display advertising -- hasn't of the unique ambitions there.
And I think -- not sought to -- -- from the secular system patch dolls over to the Internet away from print media mostly.
But all of I think you know those two companies.
-- going to be challenged in terms of -- market share -- from FaceBook.
In the presence of FaceBook and Amazon and and -- -- so it's not that there what is clear is it's just that there are other opportunities at other opportunities and -- gonna have a hard time taking share from mom who FaceBook and Amazon as well speaking of FaceBook will put all of pictures choices up on FaceBook dot com slash after the bell Victor -- great to see you thank you very much Victor is with Topeka capital markets -- their analyst.
