Omicron Variant Concerns Present 'Clear Buying Opportunity' In Apple And These Tech Stocks, Says Analyst

Wedbush analyst Dan Ives says the investment firm’s “tech playbook” remains unchanged in the wake of the Omicron variant of the COVID-19 virus, with Apple Inc remaining a clear favorite.

What Happened:Ives said among the FAANG stocks — made up of Facebook Inc, Apple,Amazon.com, Inc,Netflix Inc,and Google parent Alphabet Inc — the Tim Cook-led tech giant remains a Wedbush darling. He said he would pick “secular winners” in FAANG.

"Ultimately this is not the first or last variant scare and our tech playbook over the last 18 months has been to use these macro/risk-off events as buying opportunities to own the techsectorspecifically cloud, cyber-security, and 5G winners," wrote Ives.

Favored cybersecurity names included Zscaler, Inc,Palo Alto Networks, Inc,CyberArk Software Ltd,Varonis Systems, Inc among others.

As per Ives, variant fears “reinforce” the Wedbush belief that cloud build among enterprises will be persistent as companies grapple with a flexible or semi-remote workforce in the years ahead.

Among the cloud companies,Microsoft Corporation was named a favorite by Ives as he said Azure’s momentum was “still in its early days.”

The Satya Nadela-led company is poised to gain more market share compared with Amazon Web Services, the cloud arm of Amazon, as per Ives. Other beneficiaries of the cloud boom include google and International Business Machines Corporation.

Ives named Matterport Inc as a metaverse play.

Why It Matters:Wedbush’s bullish cloud predictions are underpinned by the prediction that enterprise workloads on the cloud will rise from the current 43% to 55% by the end of 2022.

On Apple, Ives also noted the strong Black Friday weekend the company enjoyed and estimated that it was on track to sell approximately 40 million iPhones between Black Friday and Christmas which the analyst said was a “record holiday pace” despite the ongoing chip shortage.

Ives maintained his “Outperform” rating on Apple with a $185 price target.

Meanwhile, journalist Mark Gurman,who extensively covers Apple, said the Apple Car wouldchallenge the tech giant’s launch schedule that it typically followed for other products such as the Apple Watch in the past.

Price Action:Apple shares closed nearly 3.2% lower in the regular session on Friday and gained almost 0.4% in the after-hours session.