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Alphabet (GOOGL) Stock Moves -1.5%: What You Should Know

Zacks Equity Research

Alphabet (GOOGL) closed the most recent trading day at $1,190.13, moving -1.5% from the previous trading session. This move was narrower than the S&P 500's daily loss of 1.56%. Meanwhile, the Dow lost 1.19%, and the Nasdaq, a tech-heavy index, lost 1.67%.

Coming into today, shares of the internet search leader had gained 0.25% in the past month. In that same time, the Computer and Technology sector lost 0.85%, while the S&P 500 lost 1.22%.

Investors will be hoping for strength from GOOGL as it approaches its next earnings release, which is expected to be October 28, 2019. On that day, GOOGL is projected to report earnings of $12.55 per share, which would represent a year-over-year decline of 3.91%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $32.84 billion, up 20.94% from the year-ago period.

For the full year, our Zacks Consensus Estimates are projecting earnings of $49.61 per share and revenue of $132.55 billion, which would represent changes of +13.52% and +20.4%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for GOOGL. Recent revisions tend to reflect the latest near-term business trends. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. Investors can capitalize on this by using the Zacks Rank. This model considers these estimate changes and provides a simple, 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 remained stagnant. GOOGL currently has a Zacks Rank of #3 (Hold).

Investors should also note GOOGL's current valuation metrics, including its Forward P/E ratio of 24.35. This valuation marks a discount compared to its industry's average Forward P/E of 27.33.

Investors should also note that GOOGL has a PEG ratio of 1.47 right now. 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 currently had an average PEG ratio of 2.54 as of yesterday's close.

The Internet - Services industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 171, which puts it in the bottom 33% 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.

To follow GOOGL in the coming trading sessions, be sure to utilize Zacks.com.


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