The so-called “FANG stocks” have been an incredibly-well performing group. For those who don’t know, FANG consists of Facebook Inc (NASDAQ:FB), Amazon.com, Inc. (NASDAQ:AMZN), Netflix, Inc. (NASDAQ:NFLX) and Alphabet Inc (NASDAQ:GOOG, NASDAQ:GOOGL) — formerly Google.
Why has this group been so successful? Despite a few of them sporting lofty valuations, they are the respective kings of their industries. Facebook dominates social media, Netflix owns streaming, Amazon is the king of e-commerce and Google owns the online search engine.
Over the past five years, Alphabet is the worst performing of the FANG stocks, returning “just” 180%. After that, it’s Facebook, which has generated 265%. Amazon’s 360% return stands out and Netflix’s 830% gain jumps off the page. Have these stocks gone too far, though?
I wouldn’t necessarily argue that. Some names warrant some extra caution in my view, however. Let’s take a further look to see which stocks are worth holding onto and which are worth taking profits in.