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Alphabet Inc. (GOOG) Exceeds Market Returns: Some Facts to Consider

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Alphabet Inc. (GOOG - Free Report) closed the latest trading day at $169.06, indicating a +1.86% change from the previous session's end. The stock's change was more than the S&P 500's daily gain of 0.49%. Elsewhere, the Dow saw a downswing of 0.2%, while the tech-heavy Nasdaq appreciated by 1.22%.

Heading into today, shares of the company had lost 11.27% over the past month, outpacing the Computer and Technology sector's loss of 12.07% and lagging the S&P 500's loss of 8.15% in that time.

The investment community will be paying close attention to the earnings performance of Alphabet Inc. in its upcoming release. The company's upcoming EPS is projected at $2.04, signifying a 7.94% increase compared to the same quarter of the previous year. Alongside, our most recent consensus estimate is anticipating revenue of $75.67 billion, indicating a 11.94% upward movement from the same quarter last year.

Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $8.89 per share and revenue of $334.55 billion, indicating changes of +10.57% and +13.36%, respectively, compared to the previous year.

Additionally, investors should keep an eye on any recent revisions to analyst forecasts for Alphabet Inc. These revisions help to show the ever-changing nature of near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the company's business and profitability.

Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.

The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 0.01% lower. Alphabet Inc. currently has a Zacks Rank of #3 (Hold).

Looking at valuation, Alphabet Inc. is presently trading at a Forward P/E ratio of 18.67. This indicates a discount in contrast to its industry's Forward P/E of 21.49.

It's also important to note that GOOG currently trades at a PEG ratio of 1.19. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. The Internet - Services industry had an average PEG ratio of 1.39 as trading concluded yesterday.

The Internet - Services industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 138, which puts it in the bottom 46% of all 250+ industries.

The strength of our individual industry groups is measured by the Zacks Industry Rank, which is calculated based on the average Zacks Rank of the individual stocks within these groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.


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