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

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The latest trading session saw Alphabet Inc. (GOOG - Free Report) ending at $165.05, denoting a -0.74% adjustment from its last day's close. The stock trailed the S&P 500, which registered a daily loss of 0.22%. Meanwhile, the Dow experienced a drop of 0.03%, and the technology-dominated Nasdaq saw a decrease of 0.33%.

Shares of the company have depreciated by 11.14% over the course of the past month, outperforming the Computer and Technology sector's loss of 12% and lagging the S&P 500's loss of 7.48%.

The investment community will be closely monitoring the performance of Alphabet Inc. in its forthcoming earnings report. In that report, analysts expect Alphabet Inc. to post earnings of $2.04 per share. This would mark year-over-year growth of 7.94%. Our most recent consensus estimate is calling for quarterly revenue of $75.67 billion, up 11.94% from the year-ago period.

Regarding the entire year, the Zacks Consensus Estimates forecast earnings of $8.89 per share and revenue of $334.55 billion, indicating changes of +10.57% and +13.36%, respectively, compared to the previous year.

Investors should also note any recent changes to analyst estimates for Alphabet Inc. These revisions typically reflect the latest short-term business trends, which can change frequently. As a result, we can interpret positive estimate revisions as a good sign for the company's business outlook.

Our research suggests that these changes in estimates have a direct relationship with upcoming stock price performance. 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, spanning from #1 (Strong Buy) to #5 (Strong Sell), boasts an impressive track record of outperformance, audited externally, with #1 ranked stocks yielding an average annual return of +25% since 1988. Over the last 30 days, the Zacks Consensus EPS estimate has moved 0.02% higher. As of now, Alphabet Inc. holds a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that Alphabet Inc. has a Forward P/E ratio of 18.7 right now. Its industry sports an average Forward P/E of 21.73, so one might conclude that Alphabet Inc. is trading at a discount comparatively.

It's also important to note that GOOG currently trades at a PEG ratio of 1.2. 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. GOOG's industry had an average PEG ratio of 1.3 as of yesterday's close.

The Internet - Services industry is part of the Computer and Technology sector. Currently, this industry holds a Zacks Industry Rank of 150, positioning it in the bottom 41% 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.

You can find more information on all of these metrics, and much more, on Zacks.com.


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