3 Incredible FAANG Stocks You’ll Want to Add to Your Portfolio in September

It’s been a while since the so-called FAANG stocks were all must-have names. Other companies like Nvidia And Microsoft have since lost their shine. The advent of artificial intelligence (AI) has of course contributed to this.

Now that the AI ​​euphoria is finally starting to fade, and the economy is slowly starting to open up again, investors should soon start to see how all the things that made FAANG stocks great then still apply now. That’s why you might want to get into some of them sooner or later, especially since a few of these stocks are trading at a discount right now.

Below is a closer look at the three FAANG stocks that are the best options for September.

1. Amazon

Amazon (NASDAQ: AMZN) has been very un-Amazon-like since early July. Stock prices are currently down more than 10% from that month’s record high and still falling, heading into what has historically been a tough month for the stock market.

At least part of the weakness stems from the company’s second-quarter revenue miss. Although revenue of $148 billion was up 10% from a year ago, analysts had been predicting revenue of $148.7 billion. Investors were spooked, and understandably so.

Maybe it’s better to take a step back and look at the bigger picture.

The fact is that Amazon is still a growth steamroller that no other e-commerce player wants to compete with. It controls about 40% of the online shopping market in the United States (according to eMarketer data), beating out the next largest Walmart‘s reach. And, as a name nearly synonymous with the e-commerce industry, it’s likely better positioned than any competitor to capture more than its fair share of the industry’s continued growth. It’s doing pretty well outside the U.S., too; international e-commerce revenues were up nearly 7% last quarter.

Perhaps Amazon’s most underrated growth engine, however, is its cloud computing business. Amazon Web Services sales rose nearly 19% year-over-year during the three-month period ending in June, leading to a 74% increase in operating revenue for its cloud business. Both figures extend established trends that should continue well into the future. Market research firm Mordor Intelligence believes the global cloud computing industry will grow at an annual rate of more than 16% through 2029.

So, why is Amazon stock falling? It has a lot to do with the shaky market environment itself, and even more to do with the stock’s big run from its late 2022 low to its June high. There’s a lot of opportunistic profit-taking going on here. But that’s actually a long-term opportunity for you.

The story continues

2. Alphabet

The same goes for Google’s parent company, Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL). That is, the stock has been falling since early July on a combination of market weakness and a drop in second-quarter earnings. While headline earnings of $1.89 per share were better than expected, YouTube’s revenue was disappointing.

Oh, There is also the possibility that the Justice Department will soon recommend a split of the company.

In early August, a federal court ruled that “Google is a monopolist and has acted as such to maintain its monopoly.” While the company prepares to appeal the decision, the court is moving forward. The next phase of the process is the DOJ’s motion for relief, which must be filed by September 4, with a meeting of all parties involved on September 6. At a minimum, the Justice Department is widely expected to ask Alphabet to divest its Chrome browser, or its Android operating system, or both. The company could also be required to share more of its collected data with third parties.

It’s certainly a troubling prospect on the surface. Alphabet’s success largely depends on dominating multiple facets of how people navigate the internet. Even if just one of them disappears, Google’s reach would seem disproportionately weakened.

But maybe that’s not the case.

Of course, Android sends people to the Google Play app store. Chrome and Google’s online services, such as Gmail and Google Docs, play very well together. Google is the default search engine on devices that many manufacturers can plug in, because Alphabet can afford to outbid other search engine operators for this placement.

However, it’s possible that consumers won’t seek out these services and tools without a nudge from Google, because that’s wishful thinking on the DOJ’s part. The world loves Google’s search engine because it’s simple and effective. Owners of Android devices, the world’s most widely used mobile operating system, will find Google Play anyway. People love Chrome simply because Chrome works well.

That doesn’t mean the Justice Department and the U.S. legal system can’t goad investors into more trouble than they already have. Together or in parts, Alphabet’s bread-and-butter advertising business will survive.

3. Apple

And last but certainly not least, add Apple (NASDAQ: AAPL) to your list of FAANG stocks to buy in September.

Apple stock has performed very differently than Alphabet or Amazon of late. While both Amazon and Apple stocks are falling after significant gains, Apple shares are now trading at record highs after a significant stagnation between early 2022 and April of this year.

What’s changed? Artificial intelligence. While Apple was a bit late to the AI ​​party, it’s making up for lost time. In June, the company introduced what it calls “Apple Intelligence,” which turns Apple’s latest iPhones and iPads into full-fledged generative AI devices that can handle the heavy lifting without the hassle of moving it to the cloud (where most of the consumer-facing AI work currently happens). The evolution is expected to revive long-stagnant iPhone sales, both in terms of revenue and individual units.

The point is, the launch of Apple Intelligence is likely to do just that, but perhaps even more than expected. Technology market research firm IDC predicts that generative AI smartphone shipments will increase from 234 million units this year to more than 900 million such devices in 2028, at which point AI-enabled smartphones will account for nearly 80% of the global mobile phone market.

Apple’s iPhone is already the world’s most popular smartphone and is well positioned to capture a bigger share of that growth.

The takeaway: While Apple will certainly benefit from any revenue growth that comes from the looming improvement in iPhone sales, getting the company’s popular phone into the hands of more consumers does something else that may be even more fruitful. Namely, it sets the stage for even more Services revenue. Services is now not only Apple’s second-largest business, but also (by far) its highest-margin business.

Should You Invest $1,000 in Amazon Now?

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John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. James Brumley has positions in Alphabet. The Motley Fool has positions in and recommends Alphabet, Amazon, Apple, Microsoft, Nvidia and Walmart. The Motley Fool recommends the following options: long January 2026 $395 calls on Microsoft and short January 2026 $405 calls on Microsoft. The Motley Fool has a disclosure policy.

3 Incredible FAANG Stocks You’ll Want to Add to Your Portfolio in September was originally published by The Motley Fool