Can Teen Sentiment Inform Stock Picks?

The Wall Street Journal's lame. Did you expect a different opinion from the Gen Zers surveyed by Alphabet Inc GOOG GOOGL? Probably not. But you may be surprised by some of their other picks.

The teens surveyed labeled a number of recognizable brands relatively uncool, including Facebook Inc FB’s WhatsApp and Facebook Messenger, Yahoo! Inc. YHOO, Sprint Corp S, McDonald’s Corporation MCD, J C Penney Company Inc JCP, Southwest Airlines Co LUV and Electronic Arts Inc. EA’s EA Sports.

So what do these picky kids actually like?

Well, Youtube is off the charts (or do they still say off the chain?) as are Netflix, Inc. NFLX and Google. They still endorse PepsiCo, Inc. PEP’s Doritos and Mondelez International Inc MDLZ’s Oreos. And PlayStation, Xbox, GoPro Inc GPRO and Nike Inc NKE haven’t lost their appeal.

Operational Performance

The coolness factor isn’t necessarily correlated with company performance, though. By some measures, product sales validate the teen consensus. By others, it seems adult purchasers are out-of-touch with what’s hip and what’s not.

Netflix, for instance, has earned the esteem of both market analysts and consumers, the latter of which helped bolster fourth-quarter domestic paid subscription figures above guidance. PepsiCo has also posted recent revenue beats — even if the government finds it less cool than Gen Z does.

Meanwhile, shoppers seem less enthused about Nike than the kids are, as the company’s latest quarterly revenue fell short of expectations and minimal earnings beat was of “low quality,” according to one analyst. They were also less sold on GoPro, which recently reported its second highest quarterly revenue in company history even as it missed estimates by $33.8 million. The camera company’s annual revenue slipped 26.8 percent year-over-year.

Stock Performance

Gen Z sentiment is also not well reflected in stock value. At least, not if social media is any indication.

On the coolness scale, the rankings go something like this: Snapchat, Instagram, Twitter Inc TWTR and Facebook. And according to the survey, about 59.6 percent of teens are on Instagram, 56.4 percent on Snapchat, 52.8 percent on Facebook and 35.4 percent on Twitter.

Although the least popular, Facebook boasts the most valuable shares ($144.42), followed distantly by Snap Inc SNAP ($21.05) and Twitter ($14.66), and lifetime trends show that the market has the most love for Facebook.

For the most part, it seems the kids have missed the memo on what’s “Wall Street” cool.

Related Links:

Millennials Would Rather Save For Their Kids’ College Education Than Save For Their Own Retirement

Millennials Poured Into ETFs In February