Summary
Barclays has identified four internet companies it views favorably, ranking Amazon at the top of its internet sector list followed by Meta Platforms, MercadoLibre and Chewy. The firm highlights each company’s core businesses and recent developments that underpin its assessment.
Barclays' top internet selections
Barclays' most recent sector rankings single out four names in the internet space. Below are the companies and the relevant developments Barclays referenced in compiling its list.
- Amazon.com Inc. (NASDAQ:AMZN) - Amazon holds the number one position on Barclays' internet sector ranking. The company operates a broad e-commerce marketplace while also running the Amazon Web Services cloud computing business. Recent developments tied to Amazon include an expanded partnership between Amazon Web Services and OpenAI, and the launch of a desktop AI assistant called Quick. Separately, Mizuho has reportedly raised its price target on Amazon, citing growth at AWS.
- Meta Platforms Inc. (NASDAQ:META) - Meta is listed second by Barclays. The company is the owner and operator of Facebook, Instagram, WhatsApp and other social networking services. Two items noted in connection with Meta are that Chinese regulators blocked Meta's planned $2 billion acquisition of Manus, and that the company announced a workforce reduction of approximately 10% as part of efficiency efforts.
- MercadoLibre Inc. (NASDAQ:MELI) - Taking the third spot is MercadoLibre, the Latin American firm that runs online marketplaces and payment systems across multiple countries in the region. The company was the subject of an analyst action in which Jefferies upgraded its rating from Hold to Buy, citing MercadoLibre's history of investing in growth opportunities.
- Chewy Inc. (NYSE:CHWY) - Rounding out Barclays' top four is Chewy, an online retailer focused on pet food, treats and supplies delivered directly to customers. Chewy disclosed an agreement to acquire the veterinary platform Modern Animal, with the deal expected to add more than $125 million in annualized revenue. In addition, Chewy's board approved a $500 million increase to the company's share repurchase program.
Why these names matter in Barclays' view
Barclays' rankings underscore distinct strengths across the selected companies. Amazon's placement at the top reflects its combined footprint in consumer e-commerce and cloud infrastructure. Meta's second position highlights its scale in social media and digital advertising. MercadoLibre's inclusion points to potential growth in Latin American digital commerce and financial services, while Chewy represents a specialized e-commerce niche focused on pet supplies and related services.
Investor context and limitations
The bank's list is presented as its current assessment of these internet stocks and is described as one data point investors may use when evaluating companies in the sector. Barclays' view captures a mixture of strategic positioning, recent corporate actions and analyst activity as reflected in the items summarized above.
Key takeaways
- Barclays places Amazon first and Meta second among four favored internet stocks, with MercadoLibre and Chewy completing the list.
- The companies on the list span multiple sub-sectors of the internet economy: e-commerce and cloud services, social platforms and digital advertising, Latin American marketplace and fintech, and specialized online retail for pets.
- Recent company-specific developments cited include partnerships and product launches at Amazon, regulatory action and cost-cutting at Meta, an analyst upgrade for MercadoLibre, and a strategic acquisition plus an expanded buyback authorization at Chewy.
Risks and uncertainties
- Regulatory intervention - Meta's planned $2 billion acquisition of Manus was blocked by Chinese regulators, illustrating the potential for regulatory action to affect strategic transactions and corporate plans.
- Workforce reductions and execution risk - Meta's announced roughly 10% workforce reduction as part of efficiency measures introduces uncertainty around operating execution and the timing of any related cost or product impacts.
- Analyst views are one data point - Barclays' rankings reflect the firm's current assessment and may not capture all variables; investors relying on a single analyst ranking face the risk that views may change as new information emerges.
Bottom line
Barclays' internet rankings emphasize a mix of scale, product initiatives and strategic moves across four companies operating in distinct corners of the internet economy. Amazon's top placement reflects its combined e-commerce and cloud presence; Meta is noted for its social platforms amid both regulatory and restructuring developments; MercadoLibre is highlighted for regional growth initiatives; and Chewy is recognized for expansion into veterinary services and an enlarged repurchase plan. These rankings represent Barclays' current viewpoint and are intended to inform, rather than dictate, investor decisions.