What Are the ‘FANG’ Stocks? A Short Explainer

Four tech giants became investor darlings after huge returns during a flat 2015 for the stock market

fang facebook amazon netflix google alphabet
TheWrap

CNBC’s Jim Cramer is known for his voluble stock advocacy, but the “Mad Money” host also made a key contribution to contemporary Wall Street lexicon, as he’s the one who coined “FANG” as a term for the stocks of Facebook, Amazon, Netflix and Google parent Alphabet.

And those FANG stocks had quite a bite in 2015, when they averaged a robust 83 percent increase — during a year when the S&P 500 actually finished down less than 1 percent. Netflix, which jumped 134 percent in 2015, was the top performing stock in the entire S&P 500.

The four FANG companies couldn’t repeat that outsize performance last year, however, as Wall Street hunted for value elsewhere. All four stocks ended 2016 higher than they started it, with Amazon up 11 percent, Facebook up 10 percent, Netflix up 8 percent and Alphabet edging up 2 percent. Still, the FANGs didn’t even perform up to the Dow Jones industrial average, which rose 13 percent last year.

Facebook, Amazon, Netflix and Alphabet are all reporting fourth-quarter and full-year earnings over the next three weeks, with Netflix going first after markets close on Wednesday. Investors and media analysts should have a particular interest in the status of Netflix and Amazon Prime Video’s international expansion, as each streaming video service added more than 100 countries last year.

And while Wall Street is still playing close attention to the fates of the FANGs, Cramer has moved on to a different, more aviation-inspired acronym. Booting Netflix in favor of Chinese e-commerce and tech giant Alibaba and accounting for Google’s name change, Cramer has a new group of stocks to watch: the FAAAs.

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