Shares of Alphabet Inc. (GOOG) have been strong performers lately, with the stock up 16% over the past month. The stock hit a new 52-week high of $304.25 in the previous session. Alphabet has gained 53.9% since the start of the year compared to the 23.2% move for the Zacks Computer and Technology sector and the 51.1% return for the Zacks Internet - Services industry.
What's Driving the Outperformance?
The stock has a great record of positive earnings surprises, as it hasn't missed our earnings consensus estimate in any of the last four quarters. In its last earnings report on October 29, 2025, Alphabet reported EPS of $2.87 versus consensus estimate of $2.26 while it beat the consensus revenue estimate by 2.95%.
For the current fiscal year, Alphabet is expected to post earnings of $10.52 per share on $340.32 in revenues. This represents a 30.85% change in EPS on a 15.32% change in revenues. For the next fiscal year, the company is expected to earn $10.94 per share on $387.9 in revenues. This represents a year-over-year change of 3.97% and 13.98%, respectively.
Valuation Metrics
Alphabet may be at a 52-week high right now, but what might the future hold for the stock? A key aspect of this question is taking a look at valuation metrics in order to determine if the company is due for a pullback from this level.
On this front, we can look at the Zacks Style Scores, as they provide investors with an additional way to sort through stocks (beyond looking at the Zacks Rank of a security). The individual style scores for Value, Growth, Momentum and the combined VGM Score run from A through F. The idea behind the style scores is to help investors pick the most appropriate Zacks Rank stocks based on their individual investment style.
Alphabet has a Value Score of D. The stock's Growth and Momentum Scores are B and B, respectively, giving the company a VGM Score of B.
In terms of its value breakdown, the stock currently trades at 27.9X current fiscal year EPS estimates, which is a premium to the peer industry average of 18.6X. On a trailing cash flow basis, the stock currently trades at 30.9X versus its peer group's average of 13.5X. Additionally, the stock has a PEG ratio of 1.7. This isn't enough to put the company in the top echelon of all stocks we cover from a value perspective.
Zacks Rank
We also need to look at the Zacks Rank for the stock, as this supersedes any trend on the style score front. Fortunately, Alphabet currently has a Zacks Rank of #2 (Buy) thanks to favorable earnings estimate revisions from covering analysts.
Since we recommend that investors select stocks carrying Zacks Rank of 1 (Strong Buy) or 2 (Buy) and Style Scores of A or B, it looks as if Alphabet fits the bill. Thus, it seems as though Alphabet shares could have a bit more room to run in the near term.
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Alphabet Inc. (GOOG): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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