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2 Internet Content Stocks to Buy From a Challenging Industry
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The Zacks Internet - Content has been suffering from challenging macroeconomic conditions globally, which is having a detrimental effect on advertising spending, the primary revenue source for industry participants. However, industry participants like Opera Limited (OPRA - Free Report) and Similarweb (SMWB - Free Report) are expanding their presence across social media, display and connected TV and search, driving top-line growth. These companies are benefiting from solid demand for digital offerings, as well as the increasing importance of video content and cloud-based applications. The rapid deployment of AI, Generative AI and large language models is aiding industry players in enhancing the recommendation and search functions of their platforms, thereby improving user experience.
Industry Description
The Zacks Internet - Content industry comprises providers of video encoding platforms, personal services, Internet content and information, staffing and outsourcing services, publishing, capital markets, media-based, home service, digital insights and measurement, stock photo, video and music licensing, and online travel companies. The industry is witnessing a rapid change in consumer behavior and ongoing digitalization. Advertising is a major revenue source for industry participants. Therefore, these companies are trying to expand their digital presence to win customers. They are also expanding their presence across social media, display, connected TV and search. Apart from the United States, a number of companies in this industry are located in Israel, the U.K., Germany, Russia and China.
3 Trends Shaping the Future of the Internet - Content Industry
Demand for Digital Offerings Growing: The industry is characterized by rapid technological change, frequent product and service introductions, and evolving standards. An expanding range of mobile, digital and cloud-based offerings by industry participants is a major growth driver. The proliferation of smart devices and the increasing automation of the application development process bode well.
Industry Prospects Driven by Ad Spending Rate: Industry participants are focusing on marketing efforts to boost traffic to websites. Advertising and subscriptions are major revenue sources for these companies. The industry is dependent on consumer spending trends, making holiday spending a major deciding factor. However, macroeconomic challenges are expected to hurt ad spending in the near term.
Increasing Regulations Mar Prospects: Industry participants involved in online search and other social networking activities are increasingly facing regulatory pressure, particularly in China and the European Union (“EU”). The China government has a number of regulations related to direct advertising, which is a prime revenue source for these companies. The implementation of the General Data Protection Regulation in the EU adds to the concerns. Enactment of the Digital Markets Act (DMA) in the EU aims to prevent large online platforms that connect users with content, goods, information and services from abusing their market power. The DMA adds to the headwinds faced by Internet content providers in the EU.
Zacks Industry Rank Indicates Dim Prospects
The Zacks Internet - Content industry is housed within the broader Zacks Computer and Technology sector. It carries a Zacks Industry Rank #145, which places it in the bottom 41% of more than 250 Zacks industries.
The group’s Zacks Industry Rank, which is the average of the Zacks Rank of all the member stocks, indicates dim near-term prospects. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than two to one.
The industry’s position in the bottom 50% of the Zacks-ranked industries is a result of a negative earnings outlook for the constituent companies in aggregate. Looking at the aggregate earnings estimate revisions, it appears that analysts are pessimistic about this group’s earnings growth potential. Since Jan. 31, 2026, the Zacks Consensus Estimate for the industry’s 2026 earnings has moved down 2%.
Given the bearish industry outlook, there are only a few stocks worth buying. But before we present the stocks that you may want to consider for your portfolio, let us take a look at the industry’s recent stock market performance and valuation.
Industry Lags S&P and Sector
The Zacks Internet - Content industry has underperformed the broader Zacks Computer and Technology sector, as well as the S&P 500 composite, over the past year.
The industry has dropped 11.6% over this period compared with the S&P 500 sector’s appreciation of 4.8% and the 8.6% rise of the broader sector.
One-Year Price Performance
Industry's Current Valuation
On the basis of the trailing 12-month price-to-sales ratio (P/S), which is a commonly used multiple for valuing Internet – Content stocks, we see that the industry is currently trading at 4.07X compared with the S&P 500’s 6.05X and the sector’s 8.67X.
Over the last five years, the industry has traded as high as 6.37X and as low as 3.25X, the median being 5.34X, as the charts below show.
Trailing 12-Month Price-to-Sales (P/S) Ratio
2 Internet Stocks to Buy
Opera: This Zacks Rank #1 (Strong Buy) stock is riding on high-margin growth from browser-based monetization, combining advertising, search/query revenue, and emerging AI-driven user intent monetization. You can see the complete list of today’s Zacks #1 Rank stocks here.
Strong execution in e-commerce ads and query expansion is driving more than 20% revenue growth and rising average revenue per user, while AI integration enhances user engagement without heavy infrastructure costs. New products (Opera AI, Neon) and adjacencies like MiniPay expand optionality.
The Zacks Consensus Estimate for Opera’s 2026 earnings has been steady at $1.42 per share over the past 30 days. OPRA shares have surged 19.4% year to date (YTD).
Price & Consensus: OPRA
Similarweb: This Zacks Rank #2 (Buy) stock is becoming a critical data layer in the AI ecosystem, leveraging its proprietary digital data moat to serve enterprises, large language models (LLMs), and AI agents. AI revenue is accelerating with large LLM data deals and partnerships (e.g., Manus) expanding TAM and monetization avenues. Transitioning from build to scale, Similarweb’s growth will be driven by enterprise expansion, AI-first products, and data licensing, though near-term volatility stems from lumpy large deals and slower core growth.
The Zacks Consensus Estimate for SMWB’s 2026 earnings has been steady at 20 cents per share over the past 30 days. Similarweb shares have dropped 65.3% on a YTD basis.
Price & Consensus: SMWB
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2 Internet Content Stocks to Buy From a Challenging Industry
The Zacks Internet - Content has been suffering from challenging macroeconomic conditions globally, which is having a detrimental effect on advertising spending, the primary revenue source for industry participants. However, industry participants like Opera Limited (OPRA - Free Report) and Similarweb (SMWB - Free Report) are expanding their presence across social media, display and connected TV and search, driving top-line growth. These companies are benefiting from solid demand for digital offerings, as well as the increasing importance of video content and cloud-based applications. The rapid deployment of AI, Generative AI and large language models is aiding industry players in enhancing the recommendation and search functions of their platforms, thereby improving user experience.
Industry Description
The Zacks Internet - Content industry comprises providers of video encoding platforms, personal services, Internet content and information, staffing and outsourcing services, publishing, capital markets, media-based, home service, digital insights and measurement, stock photo, video and music licensing, and online travel companies. The industry is witnessing a rapid change in consumer behavior and ongoing digitalization. Advertising is a major revenue source for industry participants. Therefore, these companies are trying to expand their digital presence to win customers. They are also expanding their presence across social media, display, connected TV and search. Apart from the United States, a number of companies in this industry are located in Israel, the U.K., Germany, Russia and China.
3 Trends Shaping the Future of the Internet - Content Industry
Demand for Digital Offerings Growing: The industry is characterized by rapid technological change, frequent product and service introductions, and evolving standards. An expanding range of mobile, digital and cloud-based offerings by industry participants is a major growth driver. The proliferation of smart devices and the increasing automation of the application development process bode well.
Industry Prospects Driven by Ad Spending Rate: Industry participants are focusing on marketing efforts to boost traffic to websites. Advertising and subscriptions are major revenue sources for these companies. The industry is dependent on consumer spending trends, making holiday spending a major deciding factor. However, macroeconomic challenges are expected to hurt ad spending in the near term.
Increasing Regulations Mar Prospects: Industry participants involved in online search and other social networking activities are increasingly facing regulatory pressure, particularly in China and the European Union (“EU”). The China government has a number of regulations related to direct advertising, which is a prime revenue source for these companies. The implementation of the General Data Protection Regulation in the EU adds to the concerns. Enactment of the Digital Markets Act (DMA) in the EU aims to prevent large online platforms that connect users with content, goods, information and services from abusing their market power. The DMA adds to the headwinds faced by Internet content providers in the EU.
Zacks Industry Rank Indicates Dim Prospects
The Zacks Internet - Content industry is housed within the broader Zacks Computer and Technology sector. It carries a Zacks Industry Rank #145, which places it in the bottom 41% of more than 250 Zacks industries.
The group’s Zacks Industry Rank, which is the average of the Zacks Rank of all the member stocks, indicates dim near-term prospects. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than two to one.
The industry’s position in the bottom 50% of the Zacks-ranked industries is a result of a negative earnings outlook for the constituent companies in aggregate. Looking at the aggregate earnings estimate revisions, it appears that analysts are pessimistic about this group’s earnings growth potential. Since Jan. 31, 2026, the Zacks Consensus Estimate for the industry’s 2026 earnings has moved down 2%.
Given the bearish industry outlook, there are only a few stocks worth buying. But before we present the stocks that you may want to consider for your portfolio, let us take a look at the industry’s recent stock market performance and valuation.
Industry Lags S&P and Sector
The Zacks Internet - Content industry has underperformed the broader Zacks Computer and Technology sector, as well as the S&P 500 composite, over the past year.
The industry has dropped 11.6% over this period compared with the S&P 500 sector’s appreciation of 4.8% and the 8.6% rise of the broader sector.
One-Year Price Performance
Industry's Current Valuation
On the basis of the trailing 12-month price-to-sales ratio (P/S), which is a commonly used multiple for valuing Internet – Content stocks, we see that the industry is currently trading at 4.07X compared with the S&P 500’s 6.05X and the sector’s 8.67X.
Over the last five years, the industry has traded as high as 6.37X and as low as 3.25X, the median being 5.34X, as the charts below show.
Trailing 12-Month Price-to-Sales (P/S) Ratio
2 Internet Stocks to Buy
Opera: This Zacks Rank #1 (Strong Buy) stock is riding on high-margin growth from browser-based monetization, combining advertising, search/query revenue, and emerging AI-driven user intent monetization. You can see the complete list of today’s Zacks #1 Rank stocks here.
Strong execution in e-commerce ads and query expansion is driving more than 20% revenue growth and rising average revenue per user, while AI integration enhances user engagement without heavy infrastructure costs. New products (Opera AI, Neon) and adjacencies like MiniPay expand optionality.
The Zacks Consensus Estimate for Opera’s 2026 earnings has been steady at $1.42 per share over the past 30 days. OPRA shares have surged 19.4% year to date (YTD).
Price & Consensus: OPRA
Similarweb: This Zacks Rank #2 (Buy) stock is becoming a critical data layer in the AI ecosystem, leveraging its proprietary digital data moat to serve enterprises, large language models (LLMs), and AI agents. AI revenue is accelerating with large LLM data deals and partnerships (e.g., Manus) expanding TAM and monetization avenues. Transitioning from build to scale, Similarweb’s growth will be driven by enterprise expansion, AI-first products, and data licensing, though near-term volatility stems from lumpy large deals and slower core growth.
The Zacks Consensus Estimate for SMWB’s 2026 earnings has been steady at 20 cents per share over the past 30 days. Similarweb shares have dropped 65.3% on a YTD basis.
Price & Consensus: SMWB