As investors look ahead into 2018, one team of analysts on the Street expects tech stock gains in the mid-cap and large-cap tech space to concentrate as “the good days consolidate down to a few players.”

RBC Capital Managing Director Mark Mahaney indicated that he expects what he calls the PE-FAANG stocks—his acronym for Priceline Group Inc. (PCLN), Expedia Inc. (EXPE) and the tech giants known as FAANG, including Facebook Inc. (FB), Apple Inc. (AAPL), Inc. (AMZN), Netflix Inc. (NFLX) and Alphabet Inc. (GOOG)—to continue to outperform while other players such as Snap Inc. (SNAP), Twitter Inc. (TWTR) and eBay Inc. (EBAY) could continue to see hard times. (See also: GOP Tax Plan Could Save Tech's Big 3 $4.5B: Cowen.)

A ‘Reasonable Chance of Happening’

The analyst noted that his PE-FAANG forecast isn’t much of a surprise, as it is “pretty in line with the consensus,” highlighting “top surprises” for the new year, meaning an event that “the average Internet investor” believes is “highly improbable” but RBC thinks “has a reasonable chance of happening.”  

While Mahaney noted that fundamental trends have been “almost insanely consistent” for the tech giants, pointing to 31 straight quarters of 20% year-over-year (YOY) growth for Alphabet-owned Google, the tech titans could face some major regulatory battles. Most notably, he sees Facebook and Alphabet in the hot seat, while the European Union may force Google to “unbundle” its Android operating system from its advertising operations.

Other possible surprises in 2018 include Netflix benefiting from an acceleration in its revenue growth, Snap undergoing a revival of its stock price after a weak 2017, Amazon doubling its operating profit margin despite heavy investment and Google carrying out a major acquisition in the cloud computing space.

Watch for Unicorns

The RBC analyst also sees IPOs of “mega unicorns” including music streaming platform Spotify, sharing economy giant Airbnb, ride sharing platforms Uber and Lyft, social media site Pinterest and file sharing leader Dropbox as possibilities.

As the media fills with reports on volatile digital currencies into the new year, Mahaney stated that blockchain has a chance of becoming a disruptive force in “internet verticals” such as payments, health care, travel and real estate. (See also: JPMorgan Bullish on Large-Cap, Mid-Cap Tech Stocks.)