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Alphabet (GOOGL) Stock Sinks As Market Gains: What You Should Know

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In the latest trading session, Alphabet (GOOGL - Free Report) closed at $1,055.73, marking a -1.47% move from the previous day. This move lagged the S&P 500's daily gain of 0.56%. At the same time, the Dow added 0.76%, and the tech-heavy Nasdaq lost 0.38%.

Prior to today's trading, shares of the internet search leader had lost 8.97% over the past month. This has lagged the Computer and Technology sector's loss of 8.65% and the S&P 500's loss of 6.76% in that time.

Investors will be hoping for strength from GOOGL as it approaches its next earnings release, which is expected to be February 7, 2019. On that day, GOOGL is projected to report earnings of $11.17 per share, which would represent year-over-year growth of 15.15%. Meanwhile, our latest consensus estimate is calling for revenue of $31.26 billion, up 20.83% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $42.22 per share and revenue of $109.51 billion, which would represent changes of +31.73% and +22.79%, respectively, from the prior year.

Investors should also note any recent changes to analyst estimates for GOOGL. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. Within the past 30 days, our consensus EPS projection has moved 5.77% higher. GOOGL is holding a Zacks Rank of #3 (Hold) right now.

In terms of valuation, GOOGL is currently trading at a Forward P/E ratio of 25.38. This represents a discount compared to its industry's average Forward P/E of 35.07.

Also, we should mention that GOOGL has a PEG ratio of 1.41. 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 was holding an average PEG ratio of 2.07 at yesterday's closing price.

The Internet - Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 87, putting it in the top 34% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. 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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