RBC Capital: 6 ‘Top Stock Picks’ To Go Long

RBC Capital’s Mark Mahaney is one of the Top 25 analysts ranked by TipRanks. This is out of over 4,800 analysts. And he has now released a very valuable report setting out his top 6 Internet stock picks. These ‘Top Stock Picks’ are split between Top Large Cap Longs and Top Small Cap Longs- and the report has now been updated to take account of second quarter earnings results.

“The most notable trend year-to-date among Large Cap Internets continues to be Outperformance” writes Mahaney, before adding: “The Small Cap sector has had an even stronger performance than the Large Caps so far in 2018.” In fact, through August and post Q2 prints, Small Cap Nets have traded up a median of 27% YTD, outpacing the Russell 2000, which is up just 9%.

Bear in mind, on a one-year basis Mahaney is currently tracking an impressive 71% success rate and 26.3% average return. This means his ratings are certainly worth paying attention to. So let’s take a closer look at his top picks now:

Top Large Cap Longs

1. Facebook (Nasdaq:FB)

Social media giant Facebook is the firm’s No. 1 pick right now. “Over 35% Ad Revenue growth… on a ~$55B revenue run rate. We still think FB is among the Best Growth Stories in Tech despite the H2 outlook (which we view as overly conservative)” cheers Mahaney.

He adds that FB’s current low market share – mid-single-digit % of Global Total Marketing – will help it maintain premium growth for a long time.

With a price target of $225, Mahaney sees shares rising 30% from current levels. See FB Price Target and Analyst Ratings Detail.

2. Spotify Technology SA (NYSE:SPOT)

Word on the beat: “Spotify is the global leader in music streaming (with 40% of all Paid Subs) and has clear, sustainable business model advantages.” Indeed SPOT is a new top pick for Mahaney- beating out Expedia. This is because, post Q2, the surge in EXPE has surged makes its near-term risk/reward less compelling.