The hot FANG stocks are not likely to continue their strong outperformance in 2018, and investors should look to overweight other technology names and value stocks, according to FundStrat.
FundStrat founder Tom Lee says the group could be challenged by the Federal Communication Commission's decision this week to do away with Obama-era net neutrality rules that guaranteed content providers equal access to the internet. Simply put, the rules prevented internet providers from charging content companies more for a higher level of service.
"While the implications are not yet known, we see this as creating the potential for content distributors to bear a greater share of the total cost of the internet," wrote Lee. FundStrat estimates the cost of the internet to be about $100 billion a year, and the winners would be telecom and cable companies that could find ways to share their costs.