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Alphabet (GOOGL) Dips More Than Broader Markets: What You Should Know

Zacks Equity Research
·3 min read

Alphabet (GOOGL) closed at $1,730.92 in the latest trading session, marking a -0.93% move from the prior day. This move lagged the S&P 500's daily loss of 0.38%. Meanwhile, the Dow lost 0.22%, and the Nasdaq, a tech-heavy index, lost 0.12%.

Prior to today's trading, shares of the internet search leader had lost 0.57% over the past month. This has lagged the Computer and Technology sector's gain of 4.43% and the S&P 500's gain of 4.12% in that time.

Wall Street will be looking for positivity from GOOGL as it approaches its next earnings report date. On that day, GOOGL is projected to report earnings of $15.63 per share, which would represent year-over-year growth of 1.82%. Our most recent consensus estimate is calling for quarterly revenue of $44.05 billion, up 17.22% from the year-ago period.

Investors might also notice 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.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. 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. The Zacks Consensus EPS estimate has moved 0.41% higher within the past month. GOOGL currently has a Zacks Rank of #2 (Buy).

Looking at its valuation, GOOGL is holding a Forward P/E ratio of 27.93. This represents a discount compared to its industry's average Forward P/E of 31.15.

Meanwhile, GOOGL's PEG ratio is currently 1.65. 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. Internet - Services stocks are, on average, holding a PEG ratio of 1.66 based on yesterday's closing prices.

The Internet - Services industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 124, which puts it in the top 49% 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.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.


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