Wedbush Projects Apple To Dominate 5G 'Super Cycle,' Disney To Beat Netflix

The new year promises positive catalysts for hardware and software players.

Benzinga · 12/30/2019 15:00

The new year promises positive catalysts for hardware and software players.

“Heading into 2020 there is clear momentum for the tech space/stocks as a number of transformational trends such as 5G, cloud, autonomous, and the streaming content wars will be front and center for the Street,” Wedbush analysts led by Daniel Ives wrote in a report.

The Rating

Ives maintained Outperform ratings on Apple Inc. (NASDAQ: AAPL), Amazon.com, Inc. (NASDAQ: AMZN), Cyberark Software Ltd (NASDAQ: CYBR), Facebook, Inc. (NASDAQ: FB), LYFT Inc (NASDAQ: LYFT), Microsoft Corporation (NASDAQ: MSFT), Palo Alto Networks Inc (NYSE: PANW), Uber Technologies Inc (NYSE: UBER), VMware, Inc. (NYSE: VMW) and Zscaler Inc (NASDAQ: ZS).

He maintained an Underperform rating on Netflix Inc (NASDAQ: NFLX).

The Thesis

Here are the analysts’ top tech predictions for 2020:

Apple will dominate the upcoming “year of the 5G Super Cycle,” Microsoft will outperform Amazon in cloud development, and Walt Disney Co (NYSE: DIS) will beat Netflix in video streaming.

Meanwhile, cyber security will rapidly consolidate, and Google will acquire a public cloud vendor to expand its GCP initiative. Alphabet, Amazon and Apple will build out and acquire into healthcare and banking services.

Tesla Inc (NASDAQ: TSLA) could strike 100,000 deliveries in China faster than it did in the U.S. and Europe, and competition and poor profitability could force Uber to shutter its Uber Eats segment.

In a more macro view, federal tech regulation will drive fines but not changes to business models. Local crackdowns could prove more painful.

“AB5 California legislation will be a major ‘gut punch’ to the Gig Economy and throw a major wrench in the business models of Uber, Lyft, DoorDash, Postmates, and other players once passed (with all eyes on the impending court battle),” Ives wrote.

Related Links:

DOT Issues Long-Delayed Proposed Rule On Remote ID For Drones

Top 3 S&P 500 Equities Are All Chip Stocks