Alphabet Inc. (GOOG) Dips More Than Broader Markets: What You Should Know

Zacks Equity Research
·3-min read

Alphabet Inc. (GOOG) closed at $2,267.92 in the latest trading session, marking a -1.11% move from the prior day. This change lagged the S&P 500's daily loss of 0.92%.

Prior to today's trading, shares of the company had gained 11.72% over the past month. This has outpaced the Computer and Technology sector's gain of 9.54% and the S&P 500's gain of 6.83% in that time.

GOOG will be looking to display strength as it nears its next earnings release, which is expected to be April 27, 2021. On that day, GOOG is projected to report earnings of $15.45 per share, which would represent year-over-year growth of 56.53%. Meanwhile, our latest consensus estimate is calling for revenue of $42.31 billion, up 25.53% from the prior-year quarter.

GOOG's full-year Zacks Consensus Estimates are calling for earnings of $69.31 per share and revenue of $187.09 billion. These results would represent year-over-year changes of +18.26% and +24.93%, respectively.

Investors might also notice recent changes to analyst estimates for GOOG. 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 ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 0.39% higher within the past month. GOOG is currently sporting a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that GOOG has a Forward P/E ratio of 33.23 right now. For comparison, its industry has an average Forward P/E of 28.67, which means GOOG is trading at a premium to the group.

Also, we should mention that GOOG has a PEG ratio of 1.87. 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 1.87 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 197, which puts it in the bottom 23% 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.

Be sure to follow all of these stock-moving metrics, and many more, on Zacks.com.


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