Homepage / Technology / How stock investors are cashing in on the red-hot ‘sharing economy’ trend
Amazon says this Prime Day was its biggest shopping event ever Kudlow says President Trump is 'so dissatisfied' with China trade talks that he is keeping the pressure on As stocks regain their footing, an ominous warning looms Goldman Sachs downgrades Clorox to sell, says valuation is 'unsustainably high' How Satya Nadella has spurred a tripling of Microsoft's stock price in just over four years Kudlow says economic growth could top 4% for 'a quarter or two,' more tax cuts could be coming The one chart that explains Netflix’s stunning comeback US housing starts plunge 12% in June to a nine-month low Aerospace titans Boeing and Airbus top $110 billion in orders at Farnborough Target uses Prime Day to its advantage, logging its 'biggest online shopping day' so far this year Billionaire Marc Lasry sees bitcoin reaching up to $40,000 as it becomes more mainstream and easier to trade These are the 10 US airports where you're most likely to be hacked Amazon shares slightly higher as investors await Prime Day results Wreck of Russian warship found, believed to hold gold worth $130 billion A bullish ‘phenomenon’ in bond market is weeks away from fading, top credit strategist says Stocks making the biggest moves premarket: MS, GOOGL, TXN, UAL, NFLX & more Twitter shares up 50% since late April means most upside priced in, analyst says in downgrade EU fines Google $5 billion over Android antitrust abuse Mortgage applications fall 2.5% as buyers struggle to find affordable homes America may not have the tools to counter the next financial crisis, warn Bernanke, Geithner and Paulson Investors are getting spooked as the risk of a no-deal Brexit rises EU expected to fine Google $5 billion over Android antitrust abuse Ex-FBI chief James Comey urges Americans to vote for Democrats in midterm elections Elon Musk apologizes to British cave diver following baseless 'pedo guy' claim Disney, Comcast and Fox: All you need to know about one of the biggest media battles ever Xiaomi shares notch new high after Hong Kong, mainland China stock exchanges reach agreement The trade war is complicating China's efforts to fix its economy European markets set for a strong open amid earnings; Google in focus Hedge fund billionaire Einhorn places sixth in major poker tournament The biggest spender of political ads on Facebook? President Trump Asian stocks poised to gain after Fed's Powell gives upbeat comments; dollar firmer Stocks are setting up to break to new highs Not all FAANG stocks are created equal EU ruling may be too little, too late to stop Google's mobile dominance Cramer explains how Netflix's stock managed to taper its drop after disappointing on earnings Airbnb condemns New York City's 'bellhop politics,' threatens legal retaliation Amazon sellers say they were unfairly suspended right before Prime Day, and now have two bad choices Investor explains why 'duller' tech stocks can have better returns than 'high-flying' tech names Elon Musk is 'thin-skinned and short-tempered,' says tech VC Texas Instruments CEO Brian Crutcher resigns for violating code of conduct Google Cloud Platform fixes issues that took down Spotify, Snapchat and other popular sites Uber exec: We want to become the 'one stop' transportation app 'What a dumb hearing,' says Democrat as Congress grills tech companies on conservative bias Amazon shares rebound, report says Prime Day sales jumped 89 percent in first 12 hours of the event How to put your medical history on your iPhone in less than 5 minutes Investment chief: Watch these two big events in 2018 Even with Netflix slowing, the market rally is likely not over Cramer: Netflix subscriber weakness debunks the 'sky's the limit' theory on the stock Netflix is looking at watch time as a new area of growth, but the competition is stiff Why Nobel laureate Richard Thaler follows Warren Buffett's advice to avoid bitcoin Rolls-Royce is developing tiny 'cockroach' robots to crawl in and fix airplane engines After Netflix plunge, Wall Street analysts forecast just tame returns ahead for the once high-flying FANG group Roku shares rise after analyst raises streaming video company's price target due to customer growth China is investing 9 times more into Europe than into North America, report reveals Amazon says US Prime Day sales 'so far bigger than ever' as glitch is resolved Netflix is on pace for its worst day in two years US lumber producers see huge opportunity, rush to expand San Francisco to consider tax on companies to help homeless Homebuilder sentiment, still high, stalls as tariffs, labor and land drive up costs Powell backs more rate hikes as economy growing 'considerably stronger' Netflix history is filled with big stock declines – like today – followed by bigger rebounds Intel shares get downgraded by Evercore ISI due to rising competition from Nvidia, AMD Petco aims to reinvent the pet store with something you can't buy online Genetic testing is coming of age, but for consumers it's buyer beware Tech 'FAANG' was the most-crowded trade in the world heading into the Netflix implosion, survey shows Netflix weak subscriber growth may indicate a 'maturity wall' that could whack the stock even more: Analyst This chart may be predicting the bull market's demise Wall Street says Netflix's stock plunge is a ‘compelling’ buying opportunity because the streaming giant ‘never misses twice’ Tesla sinks after Musk tweets, again Boeing announces new division devoted to flying taxis Stocks making the biggest move premarket: NFLX, UNH, GS, AMZN, WMT & more Deutsche Bank downgrades Netflix, but says big subscriber miss is not 'thesis changing' IBM is experimenting with a cryptocurrency that’s pegged to the US dollar North Korea and Zimbabwe: A friendship explained Virgin Galactic spinoff Orbit to launch rockets from the UK with space deal Artificial intelligence will create more jobs than it destroys? That’s what PwC says ‘Treasonous’ Trump and ‘Putin’s poodle:' Scathing headlines follow the Trump-Putin summit China’s fintech companies offer ‘enormous’ opportunity, investment manager says Trump's performance at summit with Putin was 'unprecedented,' experts say Walmart and Microsoft link up on cloud technology as they both battle Amazon European stocks seen mixed amid earnings; Fed’s Powell to address Congress How I knew I should quit my day job and run my start-up full-time: Viral website founder China's stocks have been trounced, but the trade war may ultimately be good news for those shares Billionaire tech investor Peter Thiel bets on crypto start-up Block.one Asian shares subdued open after mixed close on Wall Street; energy stocks under pressure Amazon cloud hits snags after Amazon Prime Day downtime Netflix isn't doomed by one quarter unless people start questioning the long-term investor thesis Tech stocks set to sink on Tuesday after rough evening for ‘FANG’ Netflix plummets after missing big on subscriber growth This wristband lets humans control machines with their minds The U.S. has a rocky history convincing Russia to extradite computer criminals Amazon suffers glitches at the start of Prime Day Jeff Bezos is now the richest man in modern history 'The United States has been foolish': Read Trump and Putin's full exchange Goldman Sachs recommends these 5 highly profitable companies — including Nvidia — to combat rising inflation Goldman Sachs releases 'tactical' stock picks for this earnings season Three red flags for Netflix ahead of its earnings report The bond market may be raising recession fears, but don't expect one anytime soon Cramer: Banks are 'making fortunes' but are still as hated as they were during the financial crisis Putin told Trump at summit: Russia never meddled in US election

Technology

How stock investors are cashing in on the red-hot ‘sharing economy’ trend

As the “sharing economy” has expanded and morphed into a seeming catch-all term for companies that connect strangers through technology, equity investors may be able to cash in on the technology-driven trend.

That’s according to an exhaustive recent report from Bank of America Merrill Lynch. The report concludes the sharing economy’s influence has blown up so tremendously in recent years, touching essentially every aspect of consumers’ lives, that it’s created a host of new business models.

A potential hurdle for many investors is that many of the firms across the sharing economy are privately owned, as BofAML strategists explored in the report, “Uberfication — Global Sharing Economy Primer.” Yet for those who cannot invest in Uber, Lyft, Airbnb and TaskRabbit, the strategists offered ideas for gaining exposure to the sharing economy through a list of over 50 selected publicly traded stocks such as Netflix, Box, PayPal, Alibaba, Expedia and Amazon. These were deemed “entry points” for investors who might be bullish on future prospects of the sharing economy.

“Although it is difficult to accurately gauge the link between such exposure and share price performance (as many factors outside the scope of this analysis are likely to play a role in short- and long-term price development), we still consider Sharing Economy exposure as an important and positive point to track,” wrote the team, led by thematic equity strategist Felix Tran. He added that the sharing economy is a global theme with a “long lifespan.”

A public company on its list with “high” exposure to the economy boasts sharing-economy-related “technologies, services, and solutions” crucial to its business model, strategy and research and development. Among large U.S.-listed companies, the only two with “high” exposure were Netflix and Box.

Among some of the large-cap stocks in the compiled list, Amazon is one of the most attractive, said Erin Gibbs, portfolio manager at S&P Global. Gibbs does not own Amazon personally, though she does advise clients’ portfolios which have positions in the company, she said.

According to the BofAML team, Amazon has “low exposure” to the sharing economy in the cloud space and “medium exposure” in the platform space.

“If you are going to buy stocks priced in the triple digit valuations, you should be compensated with consistent accelerating earnings growth and strong management,” Gibbs told CNBC in an email on Tuesday. Amazon delivers this, she wrote, recalling the success of the company’s third annual “Prime Day,” along with its recent Whole Foods acquisition, as examples of solid execution.

“Unfortunately, most of the sharing economy stocks are also very expensive from a valuation perspective, and only a few offer compelling profit growth to justify the price. I would recommend buying selectively within BofAML’s sharing universe,” Gibbs wrote.

The BofAML report acknowledges the sharing-economy concept is not a recent innovation, but argues that the technologies powering its various platforms have certainly evolved and strengthened. The report quotes NYU Stern School professor Arun Sundararajan: “Sharing isn’t new. What is new in the ‘Sharing Economy,’ is that you are providing these services to a stranger for money rather than helping a friend for free.”

Consumer interest and corporation interest in the space has risen, per measurements by Google Trends and judging by the number of mentions in company presentations and earnings transcripts between 2013 and June of 2017, of which there have been over 200. And though millennials and the younger centennials (also known as Generation Z) are “undisputedly” the largest cohorts in the sharing economy, all demographics are increasingly getting into sharing companies.

Furthermore, as bulls have piled into stocks such as Alphabet, Netflix and Amazon, venture capitalists have piled into some of the biggest “sharing” names. In fact, funding for some of the giant players in the space has been incredibly concentrated, with several large venture capitalist firms leading the way. According to Crunchbase figures referenced in the report, 75 percent of funding has been allocated to five companies alone: Uber, Airbnb, Lyft, Indian ride-sharing company Ola and Instacart.

Source: Tech CNBC
How stock investors are cashing in on the red-hot ‘sharing economy’ trend

Comments are closed.