At $1137.51, Is It Time To Buy Alphabet Inc (NASDAQ:GOOG)?
Today we’re going to take a look at the well-established Alphabet Inc (NASDAQ:GOOG). The company’s stock saw a double-digit share price rise of over 10% in the past couple of months on the NasdaqGS. With many analysts covering the large-cap stock, we may expect any price-sensitive announcements have already been factored into the stock’s share price. However, what if the stock is still a bargain? Let’s examine Alphabet’s valuation and outlook in more detail to determine if there’s still a bargain opportunity. See our latest analysis for Alphabet
What is Alphabet worth?
The stock is currently trading at $1137.51 on the share market, which means it is overvalued by 49% compared to my intrinsic value of $762.68. Not the best news for investors looking to buy! In addition to this, it seems like Alphabet’s share price is quite stable, which could mean two things: firstly, it may take the share price a while to fall back down to an attractive buying range, and secondly, there may be less chances to buy low in the future once it reaches that value. This is because the stock is less volatile than the wider market given its low beta.
What does the future of Alphabet look like?
Future outlook is an important aspect when you’re looking at buying a stock, especially if you are an investor looking for growth in your portfolio. Buying a great company with a robust outlook at a cheap price is always a good investment, so let’s also take a look at the company’s future expectations. With profit expected to grow by 89.14% over the next couple of years, the future seems bright for Alphabet. It looks like higher cash flows is on the cards for the stock, which should feed into a higher share valuation.
What this means for you:
Are you a shareholder? It seems like the market has well and truly priced in Alphabet’s positive outlook, with shares trading above its fair value. However, this brings up another question – is now the right time to sell? If you believe Alphabet should trade below its current price, selling high and buying it back up again when its price falls towards its real value can be profitable. But before you make this decision, take a look at whether its fundamentals have changed.
Are you a potential investor? If you’ve been keeping an eye on Alphabet for a while, now may not be the best time to enter into the stock. The price has surpassed its true value, which means there’s no upside from mispricing. However, the positive outlook is encouraging for Alphabet, which means it’s worth diving deeper into other factors in order to take advantage of the next price drop.
Price is just the tip of the iceberg. Dig deeper into what truly matters – the fundamentals – before you make a decision on Alphabet. You can find everything you need to know about Alphabet in the latest infographic research report. If you are no longer interested in Alphabet, you can use our free platform to see my list of over 50 other stocks with a high growth potential.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.
The author is an independent contributor and at the time of publication had no position in the stocks mentioned.
