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

Alphabet (GOOGL) closed at $1,030.45 in the latest trading session, marking a +0.29% move from the prior day. The stock outpaced the S&P 500's daily loss of 1.82%. Elsewhere, the Dow lost 2.21%, while the tech-heavy Nasdaq lost 1.7%.

Prior to today's trading, shares of the internet search leader had lost 7.55% over the past month. This has lagged the Computer and Technology sector's loss of 5.96% and the S&P 500's loss of 2.57% 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 $11.01 per share, which would represent year-over-year growth of 13.51%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $31.26 billion, up 20.83% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $42.22 per share and revenue of $109.51 billion. These totals would mark changes of +31.73% and +22.79%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for GOOGL. These revisions typically reflect the latest short-term business trends, which can change frequently. As such, positive estimate revisions reflect analyst optimism about the company's business and profitability.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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.

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. The Zacks Consensus EPS estimate has moved 5.59% higher within the past month. GOOGL is currently sporting a Zacks Rank of #3 (Hold).

Looking at its valuation, GOOGL is holding a Forward P/E ratio of 24.34. This represents a discount compared to its industry's average Forward P/E of 31.99.

Also, we should mention that GOOGL has a PEG ratio of 1.35. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Internet - Services was holding an average PEG ratio of 2.36 at yesterday's closing price.

The Internet - Services industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 97, which puts it in the top 38% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual 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 GOOGL in the coming trading sessions, be sure to utilize Zacks.com.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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