Back to top

Image: Bigstock

Alphabet Inc. (GOOG) Dips More Than Broader Markets: What You Should Know

Read MoreHide Full Article

Alphabet Inc. (GOOG - Free Report) closed at $2,780.34 in the latest trading session, marking a -1.73% move from the prior day. This change lagged the S&P 500's daily loss of 1.7%.

Heading into today, shares of the company had gained 2.19% over the past month, lagging the Computer and Technology sector's gain of 2.54% and outpacing the S&P 500's loss of 0.27% in that time.

Investors will be hoping for strength from GOOG as it approaches its next earnings release. In that report, analysts expect GOOG to post earnings of $23.12 per share. This would mark year-over-year growth of 40.98%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $51.41 billion, up 35.25% from the year-ago period.

GOOG's full-year Zacks Consensus Estimates are calling for earnings of $101.86 per share and revenue of $205.21 billion. These results would represent year-over-year changes of +73.79% and +37.04%, respectively.

Any recent changes to analyst estimates for GOOG should also be noted by investors. These recent revisions tend to reflect the evolving nature of short-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. GOOG is currently sporting a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that GOOG has a Forward P/E ratio of 27.78 right now. For comparison, its industry has an average Forward P/E of 27.78, which means GOOG is trading at a no noticeable deviation to the group.

Also, we should mention that GOOG has a PEG ratio of 1.84. This popular metric is similar to the widely-known P/E ratio, with the difference being that the PEG ratio also takes into account the company's expected earnings growth rate. The Internet - Services industry currently had an average PEG ratio of 3.92 as of yesterday's close.

The Internet - Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 121, putting it in the top 48% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

To follow GOOG in the coming trading sessions, be sure to utilize Zacks.com.


See More Zacks Research for These Tickers


Normally $25 each - click below to receive one report FREE:


Alphabet Inc. (GOOG) - free report >>

Published in