Alphabet (NasdaqGS:GOOGL) - Share price, News & Analysis

Q: What is the Fair Price of GOOGL when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

GOOGL ($2291.44) is trading below our estimate of [[fair value]] ($4711.58)

GOOGL fundamental analysis
Snowflake Score
Valuation	5/6
Future Growth	4/6
Past Performance	6/6
Financial Health	5/6
Dividends	0/6

GOOGL Stock Overview

Alphabet Inc. provides various products and platforms in the United States, Europe, the Middle East, Africa, the Asia-Pacific, Canada, and Latin America.

Rewards

Trading at 51.4% below our estimate of its fair value

Earnings are forecast to grow 14.21% per year

Earnings grew by 45.1% over the past year

Risk Analysis

No risks detected for GOOGL from our risk checks.

Alphabet Competitors

Amazon.com

NasdaqGS:AMZN

US$1.2t

Apple

NasdaqGS:AAPL

US$2.3t

Meta Platforms

NasdaqGS:META

US$474.8b

Microsoft

NasdaqGS:MSFT

US$2.0t

Price History & Performance

Summary of all time highs, changes and price drops for Alphabet
Historical stock prices
Current Share Price	US$2,291.44
52 Week High	US$3,030.93
52 Week Low	US$2,037.69
Beta	1.13
1 Month Change	-1.93%
3 Month Change	-15.69%
1 Year Change	-9.41%
3 Year Change	100.84%
5 Year Change	136.80%
Change since IPO	4,467.58%

Recent News & Updates

Jun 26

Alphabet (NASDAQ:GOOGL) Seems To Use Debt Rather Sparingly

Legendary fund manager Li Lu (who Charlie Munger backed) once said, 'The biggest investment risk is not the volatility...

Jun 15

Google Makes A Safe Bet With Mandiant

Time to put money to work. Merger arb spreads are wide. Here’s another you can buy today.

Jun 13

Should You Be Adding Alphabet (NASDAQ:GOOGL) To Your Watchlist Today?

It's only natural that many investors, especially those who are new to the game, prefer to buy shares in 'sexy' stocks...

Jun 03

Google Searches For Direction As It Narrowly Misses Target

Examining the now formed 1-2-3 wave pattern. Looking deeper into the charts behind this setup. Covering Google's next immediate move.

Shareholder Returns

	GOOGL	US Interactive Media and Services	US Market
7D	2.6%	2.6%	0.7%
1Y	-9.4%	-29.3%	-18.4%

Return vs Industry: GOOGL exceeded the US Interactive Media and Services industry which returned -30.1% over the past year.

Return vs Market: GOOGL exceeded the US Market which returned -18.4% over the past year.

Price Volatility

Is GOOGL's price volatile compared to industry and market?
GOOGL volatility
GOOGL Average Weekly Movement	5.9%
Interactive Media and Services Industry Average Movement	11.2%
Market Average Movement	8.2%
10% most volatile stocks in US Market	16.9%
10% least volatile stocks in US Market	3.4%

Stable Share Price: GOOGL is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 6% a week.

Volatility Over Time: GOOGL's weekly volatility (6%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1998	163,906	Sundar Pichai	https://www.abc.xyz

Alphabet Inc. provides various products and platforms in the United States, Europe, the Middle East, Africa, the Asia-Pacific, Canada, and Latin America. It operates through Google Services, Google Cloud, and Other Bets segments. The Google Services segment offers products and services, including ads, Android, Chrome, hardware, Gmail, Google Drive, Google Maps, Google Photos, Google Play, Search, and YouTube.

Alphabet Fundamentals Summary

How do Alphabet's earnings and revenue compare to its market cap?
GOOGL fundamental statistics
Market Cap	US$1.50t
Earnings (TTM)	US$74.54b
Revenue (TTM)	US$270.33b

20.2x

P/E Ratio

5.6x

P/S Ratio

Is GOOGL overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
GOOGL income statement (TTM)
Revenue	US$270.33b
Cost of Revenue	US$116.44b
Gross Profit	US$153.90b
Other Expenses	US$79.36b
Earnings	US$74.54b

Last Reported Earnings

Mar 31, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	113.20
Gross Margin	56.93%
Net Profit Margin	27.57%
Debt/Equity Ratio	5.1%

How did GOOGL perform over the long term?

See historical performance and comparison

We’ve recently updated our valuation analysis.

Valuation

Is GOOGL undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

5/6

Valuation Score 5/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
PEG Ratio

Key Valuation Metric

Which metric is best to use when looking at relative valuation for GOOGL?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for GOOGL. This is calculated by dividing GOOGL's market cap by their current preferred multiple.
What is GOOGL's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	US$1.50t

GOOGL key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	5.1x
Enterprise Value/EBITDA	14.5x
PEG Ratio	1.4x

Price to Earnings Ratio vs Peers

How does GOOGL's PE Ratio compare to its peers?

GOOGL PE Ratio vs Peers

The above table shows the PE ratio for GOOGL vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	29.3x
AMZN Amazon.com	54.3x	45.4%	US$1.2t
AAPL Apple	22.7x	3.5%	US$2.3t
META Meta Platforms	12.7x	13.6%	US$474.8b
MSFT Microsoft	27.5x	12.0%	US$2.0t
GOOGL Alphabet	20.2x	14.2%	US$1.5t

Forward PE

Price-To-Earnings vs Peers: GOOGL is good value based on its Price-To-Earnings Ratio (20.2x) compared to the peer average (29.3x).

Price to Earnings Ratio vs Industry

How does GOOGL's PE Ratio compare vs other companies in the US Interactive Media and Services Industry?

Price-To-Earnings vs Industry: GOOGL is good value based on its Price-To-Earnings Ratio (20.2x) compared to the US Interactive Media and Services industry average (42.2x)

Price to Earnings Ratio vs Fair Ratio

What is GOOGL's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

GOOGL PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	20.2x
Fair PE Ratio	39.4x

Price-To-Earnings vs Fair Ratio: GOOGL is good value based on its Price-To-Earnings Ratio (20.2x) compared to the estimated Fair Price-To-Earnings Ratio (39.4x).

Share Price vs Fair Value

What is the Fair Price of GOOGL when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: GOOGL ($2291.44) is trading below our estimate of fair value ($4711.58)

Significantly Below Fair Value: GOOGL is trading below fair value by more than 20%.

Price to Earnings Growth Ratio

PEG Ratio: GOOGL is poor value based on its PEG Ratio (1.4x)

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Future Growth

How is Alphabet forecast to perform in the next 1 to 3 years based on estimates from 42 analysts?

Future Growth Score

4/6

Future Growth Score 4/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

14.2%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: GOOGL's forecast earnings growth (14.2% per year) is above the savings rate (1.9%).

Earnings vs Market: GOOGL's earnings (14.2% per year) are forecast to grow faster than the US market (13% per year).

High Growth Earnings: GOOGL's earnings are forecast to grow, but not significantly.

Revenue vs Market: GOOGL's revenue (13% per year) is forecast to grow faster than the US market (7.9% per year).

High Growth Revenue: GOOGL's revenue (13% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: GOOGL's Return on Equity is forecast to be high in 3 years time (28%)

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Past Performance

How has Alphabet performed over the past 5 years?

Past Performance Score

6/6

Past Performance Score 6/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

31.5%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: GOOGL has high quality earnings.

Growing Profit Margin: GOOGL's current net profit margins (27.6%) are higher than last year (26.1%).

Past Earnings Growth Analysis

Earnings Trend: GOOGL's earnings have grown significantly by 31.5% per year over the past 5 years.

Accelerating Growth: GOOGL's earnings growth over the past year (45.1%) exceeds its 5-year average (31.5% per year).

Earnings vs Industry: GOOGL earnings growth over the past year (45.1%) exceeded the Interactive Media and Services industry -37.6%.

Return on Equity

High ROE: GOOGL's Return on Equity (29.3%) is considered high.

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Financial Health

How is Alphabet's financial position?

Financial Health Score

5/6

Financial Health Score 5/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: GOOGL's short term assets ($177.9B) exceed its short term liabilities ($61.9B).

Long Term Liabilities: GOOGL's short term assets ($177.9B) exceed its long term liabilities ($41.1B).

Debt to Equity History and Analysis

Debt Level: GOOGL has more cash than its total debt.

Reducing Debt: GOOGL's debt to equity ratio has increased from 2.4% to 5.1% over the past 5 years.

Debt Coverage: GOOGL's debt is well covered by operating cash flow (758.7%).

Interest Coverage: GOOGL earns more interest than it pays, so coverage of interest payments is not a concern.

Balance Sheet

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Dividend

What is Alphabet current dividend yield, its reliability and sustainability?

Dividend Score

0/6

Dividend Score 0/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Cash Flow Coverage

Dividend Yield vs Market

Notable Dividend: Unable to evaluate GOOGL's dividend yield against the bottom 25% of dividend payers, as the company has not reported any recent payouts.

High Dividend: Unable to evaluate GOOGL's dividend yield against the top 25% of dividend payers, as the company has not reported any recent payouts.

Stability and Growth of Payments

Stable Dividend: Insufficient data to determine if GOOGL's dividends per share have been stable in the past.

Growing Dividend: Insufficient data to determine if GOOGL's dividend payments have been increasing.

Earnings Payout to Shareholders

Earnings Coverage: Insufficient data to calculate payout ratio to determine if its dividend payments are covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: Unable to calculate sustainability of dividends as GOOGL has not reported any payouts.

Discover strong dividend paying companies

Management

How experienced are the management team and are they aligned to shareholders interests?

5.6yrs

Average management tenure

CEO

Sundar Pichai (49 yo)

2.58yrs

Tenure

US$6,322,599

Compensation

Mr. Sundar Pichai is Chief Executive Officer at Alphabet Inc. since December 2019. Mr. Pichai has been the Chief Executive Officer of Google Inc., since October 02, 2015. Mr. Pichai leads the product manag...

CEO Compensation Analysis

Compensation vs Market: Sundar's total compensation ($USD6.32M) is below average for companies of similar size in the US market ($USD13.41M).

Compensation vs Earnings: Sundar's compensation has been consistent with company performance over the past year.

Leadership Team

Experienced Management: GOOGL's management team is seasoned and experienced (5.6 years average tenure).

Board Members

Experienced Board: GOOGL's board of directors are seasoned and experienced ( 17.5 years average tenure).

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/07/06 00:00
End of Day Share Price	2022/07/06 00:00
Earnings	2022/03/31
Annual Earnings	2021/12/31