Amazon stock is at 'one of the cheapest entry points' in 10 years, says leading tech analyst Mahaney
Despite a 30 percent advance in 2017, Amazon (NASDAQ: AMZN) shares are a really good buy right now, RBC Capital Markets lead internet and tech analyst Mark Mahaney told CNBC on Monday.
"Amazon now trades at about 18 times cash flow. It's actually one of the cheapest entry points you could buy Amazon over the past 10 years," Mahaney said on "Squawk Box," with tech stocks under pressure to start the week after the sector's broad sell-off Friday that saw Amazon drop 3 percent.
"Netflix is a stretch valuation. It has been for a long time. We only see small, single-digit upside to the price target," he said. Netflix (NASDAQ: NFLX) shares sank 4.7 percent on Friday but were still 27 percent higher year to date. "It's not one of our top picks here."
Mahaney, however, said Facebook (NASDAQ: FB) was among his top picks. "I think [it] still gives you more than 20 percent upside between now and the year of the year." Facebook stock fell nearly 3.3 percent on Friday. However, the social network remained up 30 percent in 2017.
"I won't want to tell you to back up the truck on Facebook," Mahaney continued. "I think the risk-reward is interesting. But there's been more interesting entry points in the past.
RBC Capital Markets makes a market in securities of Facebook, Netflix and Amazon.
The Friday downturn in the tech sector was not enough of a reason to buy the group, Mahaney said. "You've got this sector that's up about 30 percent year to date and trades off 3 percent in one day that does not strike me as a big buying opportunity."
Tech stocks have been leading the market higher "so they can certainly lead it down," he warned. "We're at a point where a correction in those stocks would bring the market down."
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