For the stocks of Facebook, Amazon, Netflix, and Google, often referred to as a group under the acronym of FANG, 2017 and 2018 have been remarkable.

A portfolio equally weighted between the four, purchased at their respective closing prices at the end of 2016 would have climbed 50% in 2017. Letting that portfolio ride into 2018, it would have climbed another 51% through July 12, for a cumulative increase of 127%.

Since then, however, the FANG group has struggled. Over the course of the last four months, from its peak on July 12 through November 23, the group is down 28%. Recent news isn’t helping.

Amazon’s revenue guidance for the seasonally important Q4 came in well below estimates.

In late October Netflix issued another $3.8 billion of bonds on top of the $10 billion it already had outstanding, to finance what it expects will be negative cash flow of $3 billion for 2018.

Meanwhile, Facebook and Google continue to deal with legal and reputational challenges stemming from data breaches.

For the period from Jan.1, 2017 through July 12, 2018, the FANGs made up four of the six top contributions to the return of the S&P 500. After climbing by so much and reverting so quickly, FANG will be under close watch by market participants to gauge their potential to contribute going forward.

Unless otherwise noted, data is sourced from Bloomberg.
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