Alphabet (GOOG) closed at $1,041.98 in the latest trading session, marking a -1.05% move from the prior day. This change lagged the S&P 500’s daily gain of 0.82%. Meanwhile, the Dow gained 0.82%, and the Nasdaq, a tech-heavy index, added 0.64%.
Heading into today, shares of the internet search leader had lost 10.31% over the past month, lagging the Computer and Technology sector’s loss of 8.68% and the S&P 500’s loss of 4.58% in that time.
GOOG will be looking to display strength as it nears its next earnings release. The company is expected to report EPS of $11.48, down 2.3% from the prior-year quarter. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $30.90 billion, up 17.76% from the year-ago period.
Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $45.59 per share and revenue of $130.18 billion. These totals would mark changes of +4.32% and +18.25%, respectively, from last year.
Any recent changes to analyst estimates for GOOG should also be noted by investors. These revisions help to show the ever-changing nature of near-term business trends. 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. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.
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. Over the past month, the Zacks Consensus EPS estimate has moved 0.05% lower. GOOG is holding a Zacks Rank of #3 (Hold) right now.
Investors should also note GOOG’s current valuation metrics, including its Forward P/E ratio of 23.1. This represents a discount compared to its industry’s average Forward P/E of 28.26.
It is also worth noting that GOOG currently has a PEG ratio of 1.32. 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. GOOG’s industry had an average PEG ratio of 2.88 as of yesterday’s close.
The Internet – Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 70, putting it in the top 28% 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 GOOG in the coming trading sessions, be sure to utilize Zacks.com.
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