Why investors should still love stocks like Apple, Amazon, Microsoft, and Google

·Anchor, Editor-at-Large
Mon, August 8, 2022 at 1:00 PM
In this article:
  • NVDA
    -5.87%
  • NFLX
    +5.91%
  • MSFT
    +0.51%
  • ROKU
    +3.30%
  • AAPL
    +0.83%
  • GOOG
    +1.38%
  • GOOGL
    +1.31%
  • AMZN
    +1.16%
  • AMC
    +15.94%

This article first appeared in the Morning Brief. Get the Morning Brief sent directly to your inbox every Monday to Friday by 6:30 a.m. ET. Subscribe

Monday, August 8, 2022

Today’s newsletter is by Brian Sozzi, an editor-at-large and anchor at Yahoo

I stunned my co-anchor Julie Hyman on Friday when I expressed optimism about the path forward for movie theater chain AMC late last week.

It’s not that AMC is going to be a rip-roaring growth stock over the next 25 years or that it has done everything right the past two years.

Rather, there is now a solid theme behind a company such as AMC that could drive better fundamentals during the next 12-18 months: Specifically, people are increasingly eschewing Netflix and Roku (as seen in each’s poor quality second quarters and outlooks) and are returning to theaters to watch some very good movies.

Against the backdrop of that theme, AMC is likely to build on its encouraging second quarter for attendance, sales, and profits — which could be supportive of the stock price. AMC CEO Adam Aron will be on Yahoo Finance Live on Monday morning, and we obviously have lots to chat about.

Patrons sit in a nearly empty AMC theatre while they wait for the first screening on reopening day during the outbreak of the coronavirus disease (COVID-19), in Burbank, California, U.S., March 15, 2021.  REUTERS/Mario Anzuoni
Patrons sit in a nearly empty AMC theatre while they wait for the first screening on reopening day during the outbreak of the coronavirus disease (COVID-19), in Burbank, California, U.S., March 15, 2021. REUTERS/Mario Anzuoni

But more generally, it’s worth it for investors to consider a few themes of their own as markets eye up the final few months of the year.

Thematic investing is once again being dusted off by Wall Street as a key differentiator, as most investors believe they have sense of how the Federal Reserve and economic concerns play into the outlook.

“The market has been deservedly focused on a mix of macro risks and influences this year,” Citi strategist Scott Chronert wrote in a new note to client. “As we move closer to recession resolution, the longer-term growth profiles associated with many themes may provide some performance edge, particularly on the heels of year-to-date valuation corrections. A new trading environment on the other side of current concerns may mean stock-specific valuation catalysts may be more closely tied to fundamentals give a lower expected macro growth profile and lesser central bank accommodation.”