Wolfe Research Names Internet Stocks for Outperformance

Key Moments

Wolfe Research identified Amazon, DoorDash, Meta Platforms, and Chewy as preferred internet names over a 12-month horizon.
The firm pointed to AWS-driven upside for Amazon, along with potential improvements in estimates and margins across select internet stocks.
Wolfe flagged a notable valuation gap between Meta and Alphabet and characterized the recent DoorDash share pullback as excessive.

Strategic Internet Picks Following Earnings Season

Investing.com – Wolfe Research issued a new report on the internet sector on Wednesday, naming Amazon (NASDAQ:AMZN), DoorDash (NYSE:DASH), Meta Platforms (NASDAQ:META), and Chewy (NYSE:CHWY) as its favored stocks over the next 12 months.

The firm observed that first-quarter earnings season wrapped up this week, and that investor focus is now turning toward several broader themes: geopolitical developments involving the U.S. and Iran, the evolution of artificial intelligence, equity valuations, uncertainty around interest rates, and U.S.-China trade dynamics.

Within this backdrop, Wolfe Research indicated it is concentrating on specific internet companies where it believes there is room for upward revisions to estimates, identifiable product-related catalysts, resilience to macroeconomic conditions, potential for revenue acceleration or margin expansion, and areas where current valuations appear misaligned with fundamentals.

Core Selection Criteria

According to the report, the key characteristics Wolfe Research is targeting in the internet space include:

Visibility into positive estimate revisions
Clear product or platform catalysts
Macro resilience across differing economic conditions
Scope for revenue growth to accelerate or for margins to expand
Valuation dislocations that may offer attractive entry points

Company-Specific Views

Company	Ticker/Exchange	Key Wolfe Thesis Elements
Amazon	NASDAQ:AMZN	AWS-driven upside to revenue and EBITDA estimates; retail share stability; operating income leverage from ads, regionalization, third-party shift, and automation
Meta Platforms	NASDAQ:META	Valuation discount vs Alphabet; product and model launches; potential Must Spark integration; enhancement of recommendation/ranking; monetization of Threads and WhatsApp
DoorDash	NYSE:DASH	Share pullback seen as overdone; near-term investment pressure; upside to Street 2027 EBITDA on healthy revenue growth and better unit economics
Chewy	NYSE:CHWY	Named as a top pick in the internet coverage universe

Amazon: AWS Momentum and Retail Profit Drivers

For Amazon, Wolfe Research projected that revenue and EBITDA estimates have room to move higher, largely supported by an anticipated acceleration at Amazon Web Services (AWS). The firm estimated AWS revenue growth in the second quarter in the low-to-mid 30% range, compared with a consensus view of 31%. It attributed this outlook to contributions from Anthropic, OpenAI, increased capacity, and organic growth in the mid-teens percentage range.

Beyond cloud, Wolfe Research expects Amazon to hold its retail market share and sees potential upside to operating income. The firm pointed to expanding advertising revenue, benefits from regionalization, a greater mix of third-party sellers, and increasing automation over time as key drivers.

Meta Platforms: Valuation Gap and Product Catalysts

Wolfe Research drew attention to what it described as a valuation gap between Meta and Alphabet. It cited Meta’s 2027 price-to-earnings multiple of 17.7 times, versus 27.4 times for Alphabet.

The report outlined several near-term catalysts for Meta, including the rollout of a revised model and a new product, possible integration of Must Spark into core products, enhancements to Meta’s recommendation and ranking systems, and monetization initiatives around Threads and WhatsApp.

DoorDash: Pullback Viewed as Excessive

On DoorDash, Wolfe Research said the recent decline in the share price after first-quarter earnings appears overdone. The firm acknowledged that fiscal 2026 could be pressured by spending on technology, software, and autonomous initiatives. However, it anticipates upside to Street expectations for fiscal 2027 EBITDA, supported by solid revenue growth trajectories and ongoing improvements in unit economics for the company’s international operations as well as its grocery and retail businesses.

Chewy Included Among Top Internet Ideas

Chewy was also listed by Wolfe Research as one of its top choices within the internet sector over the 12-month period, alongside Amazon, DoorDash, and Meta Platforms.