In the latest close session, Alphabet (GOOGL) was up +2.34% at $170.68. Meanwhile, the Dow lost 0.25%, and the Nasdaq, a tech-heavy index, added 0.31%.
The internet search leader's shares have seen a decrease of 3.55% over the last month, not keeping up with the Computer and Technology sector's gain of 7.62% and the S&P 500's gain of 5.05%.
The investment community will be closely monitoring the performance of Alphabet in its forthcoming earnings report. On that day, Alphabet is projected to report earnings of $2.12 per share, which would represent year-over-year growth of 12.17%. Meanwhile, the latest consensus estimate predicts the revenue to be $78.88 billion, indicating a 10.55% increase compared to the same quarter of the previous year.
Looking at the full year, the Zacks Consensus Estimates suggest analysts are expecting earnings of $9.53 per share and revenue of $326.57 billion. These totals would mark changes of +18.53% and +10.66%, respectively, from last year.
Investors should also note any recent changes to analyst estimates for Alphabet. These latest adjustments often mirror the shifting dynamics of short-term business patterns. As such, positive estimate revisions reflect analyst optimism about the business and profitability.
Empirical research indicates that these revisions in estimates have a direct correlation with impending stock price performance. 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 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. Over the past month, the Zacks Consensus EPS estimate remained stagnant. As of now, Alphabet holds a Zacks Rank of #3 (Hold).
Digging into valuation, Alphabet currently has a Forward P/E ratio of 17.5. This signifies a discount in comparison to the average Forward P/E of 19.37 for its industry.
One should further note that GOOGL currently holds a PEG ratio of 1.06. Comparable to the widely accepted P/E ratio, the PEG ratio also accounts for the company's projected earnings growth. The Internet - Services industry currently had an average PEG ratio of 1.33 as of yesterday's close.
The Internet - Services industry is part of the Computer and Technology sector. With its current Zacks Industry Rank of 152, this industry ranks in the bottom 39% of all industries, numbering over 250.
The Zacks Industry Rank assesses the vigor of our specific industry groups by computing the average Zacks Rank of the individual stocks incorporated in the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.
Don't forget to use Zacks.com to keep track of all these stock-moving metrics, and others, in the upcoming trading sessions.
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Alphabet Inc. (GOOGL): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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