Tech wreck: Goldman Sachs cuts Netflix, Roblox and eBay to ‘sell’
Analysts said the downgrades were made after deciding “to factor in a greater likelihood of a weaker macroeconomic environment and significantly weaker revenue growth…to reflect broader industry maturation.” “.
Shares of Netflix and eBay both fell 5% on Friday while Roblox fell 9%.
Goldman Sachs analysts said they downgraded Netflix due to “concerns about the impact of a consumer recession as well as increased levels of competition”. They said Netflix is now a “demonstration story”.
There are growing concerns that cash-strapped consumers may find they are now paying for too many streaming services and need to cut spending.
But there are “growing concerns about the post-pandemic environment” for Roblox. Goldman analysts expect “slower growth” in the near term.
Analysts said that while “pent-up travel demand…remains a tailwind,” there are worries about a recession, the stock’s valuation and the possibility of a “potential normalization in consumer travel habits.” leading to more people staying in hotels as opposed to renting homes when going on vacation.
Still, it wasn’t all bad from the so-called Vampire Squid about Big Tech.
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