FANGMAN stocks actually started out just as the FANG stocks. FANG was a term originally popularized in 2013 by famous TV personality and hedge fund founder of Cramer Berkowitz, Jim Cramer.
It was made as an acronym that refers to the most popular and best-performing American technology companies.
At the time the four companies that Cramer said dominated their respective markets were Facebook, Amazon, Netflix and Google. Since then there have been additions to FANG, the first being Apple as the second A in the acronym (FAANG) in 2017.
Today the acronym has become much longer with many other variations as American tech companies solidify themselves as front-runners in their markets.
FANGMAN is a popular variation of the acronym but for this blog, we’re going to add +T (Tesla) into the acronym. FANGMAN+T stands for:
- Facebook ($META)
- Apple ($AAPL)
- NVIDIA ($NVDA)
- Google ($GOOGL)
- Microsoft ($MSFT)
- Amazon ($AMZN)
- Netflix ($NFLX)
- Tesla ($TSLA)
- Why FANGMAN Stocks are attractive to some
- A warning before we continue…
- Stock price performance during crashes
- FANGMAN Stock 5-Year Performance (June 9 2017 Open -> June 9 2022 Close)
- Fundamentals Comparison
- What do I do with this information?
Why FANGMAN Stocks are attractive to some
Investors like FANGMAN+T stocks because they are tech companies that are already well established (huge market caps). This separates them from a lot of tech companies that are “growth tech” and may require a lot of funding or years of exponential growth to become household names like the FANGMAN+T stocks.
A warning before we continue…
We watched both Facebook and Netflix lose 50% of their value in a matter of days, last month. These stocks are not impervious to extreme market movements.
Now, it’s hard to imagine the world without Google, Amazon, Apple and the others, but that doesn’t mean they will always be around. Just remember Sears, Zellers, Blockbusters, etc.
So FANGMAN stocks shouldn’t be considered “safe.” They carry just as much risk as other tech companies.
If you already hold other tech companies, it may be worth thinking about diversifying away from tech as interest rates rise.
Stock price performance during crashes
2008 (Sep 2008 open -December 2008 close)
|Apple||$6.16 to $3.05||-50.49%|
2000 (April 2000 open -December 2000 close)
FANGMAN Stock 5-Year Performance (June 9 2017 Open -> June 9 2022 Close)
|5 year %||18.89%||267.63%||338.16%||141.98%||267.56%||129.41%||15.94%||860.36%|
Price to Earnings (PE) Ratio – This compares the stock price to the company’s profit. The higher the ratio, the more expensive it is in relation to itself and its peers. The question is whether the company will continue its growth in the future and the share price to catch up.
|P/E Ratio (Current)||13.91||23.19||48.44||20.77||27.63||56.02||17.5||97.58|
Debt to Equity (D/E) Ratio – Compares the company’s total debt to total equity, giving you a picture of how leveraged the company is. As you will know, with interest rate hikes, it will become increasingly more expensive to service its debt.
|D/E Ratio (Current)||0.12||1.78||0.44||0.11||0.48||0.97||0.99||0.2|
Earnings Per Share (EPS) – A basic measurement of how much profit per share the company brings in.
Book Value Per Share – Is the Shareholder equity divided by the number of all shares out on the market (outstanding shares).
|Book Value Per SHare||45.4||4.4||10.51||385.58||20.24||13.16||39.49||32.9|
What do I do with this information?
If you believe that these companies are here to stay, they may be worth investigating further.
It’s worth noting that most of these companies do not pay a dividend. For the few that do pay dividends, the yields are pretty low.
Maybe you’re looking for growth, but you’re not ready to put money into relatively untested companies. FANGMAN stocks could be a place to start.
If you want some protection as you start to invest in these companies, consider learning how to trade stock options. You can start with our Options for Beginners series.
That’s all for now.
Your fellow Stock Hackers,
🍒Cherry & Erwin
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