Shares of Amazon and Alphabet fell in morning trading Friday, while Apple shares were flat, following quarterly reports that showed broad signs of a slowing economy as electronics sales, online shopping and digital advertising all fell during 2022’s last three months.
Alphabet sold off 4.54, or 4.1%, to $104.26, paring some of the 21% in gains its seen since the start of 2023. Amazon shares, which rallied 28% year to date, dropped $5.61, or 5%, to $107.30.
Apple shares added 32 cents, rising to $151.14. The stock has seen a 20% rally since the start of the year.
The tech giants’ reports left investors worried about the health of the worldwide economy as the results showed broadly slowing demand as higher interest rates kick in globally.
Alphabet Inc. reported after the market closed Thursday that revenue stalled in the fourth quarter of 2022, gaining just 1%, while YouTube ad revenue tumbled more than 7%.
Piper Sandler analyst Thomas Champion lowered the firm’s price target on Alphabet to $120 from $122, meaning he expects the stock to gain just about 10% for the rest of the year. He kept an “Overweight,” or “buy” rating on the shares, despite advertising trends he called “slightly weaker than expected” and slower search and cloud growth.
Barclays analyst Ross Sandler, however, raised his price target to $160 from $150, with an “Overweight” rating, stating in a note to clients that the company “sounded very constructive on efficiency improvements going forward,” according to TheFly.com.
Amazon, which beat projections even as it said operating profit could fall in the current quarter due to lower demand, saw a wave of price target increases from analysts, among them Baird’s Colin Sebastian.
Sebastian raised the firm’s price target to $125 from $120 and kept an “Outperform” rating on the shares, stating that the company’s e-commerce results weren’t as bad as feared and pointing to accelerating subscriptions growth from Prime sign-ups and pricing.
Analysts had a mixed reaction to Apple’s results, with at least half a dozen on Wall Street raising price targets on the stock and nearly an equal number cutting their projections.
Wedbush analyst Daniel Ives raised his target to $180 from $175 and kept an “Outperform” rating. He attributed part of Apple’s slowdown to major iPhone supply chain issues due to COVID lockdowns in China and noted that Apple, in “stark contrast” to most of its rivals, has no major layoffs planned.
JPMorgan analyst Samik Chatterjee made the reverse move, cutting his price target to $175 from $180, and stating that Apple’s guidance reflects a “deeper down cycle” for consumer projects like smartphones and personal computers.