Alphabet is one of the largest company’s in the world by market capitalization, and it has a long history of profitable growth. The company is known for its innovative products and services, and it has a strong competitive position in the global marketplace. In this article we will examine the question if Alphabet/Google stock is a good buy right now.
Fundamental Analysis
For Google (now Alphabet Inc.), the company’s financials have been strong, with consistent revenueThe income statement provides a summary of a company's revenue and expenses over a specified period of time, typically a year or a quarter. It shows the company's total revenue, th... growth and high profitability. In the most recent Q4, Alphabet reported revenue of $75.4 billion, up 10% from Q3. The company has a strong balance sheetThe balance sheet is a snapshot of a company's financial position at a specific point in time. It shows the company's assets, liabilities, and equity., with a significant amount of cash and marketable securities, and a solid track record of innovation and growth in its core search and advertising businesses, as well as in new ventures such as cloud computing, self-driving cars, and artificial intelligence.
What few investors realize is that Google stock is trading at a discount to its EPS. The stock is currently trading at a P/E of 13 while a fair market value would be a P/E of 15. The stock trading at a discount relative to EPS won’t last long as we expect the price to trend higher until the stock hits a P/E of 15.
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Technical Analysis
From a technical analysis perspective, the stock has been trading in an uptrend channelUptrend and downtrend channel patterns are technical analysis tools used to identify potential future price movements. They are formed by two parallel lines on a chart and can be u... and has recently broken above a key resistance level. The relative strength index (RSI) at 52.4 is also in bullish territory, suggesting that the stock may continue to move higher. Additionally, the stock has outperformed the overall market and its peers in recent months.
Overall, while no one can predict the future performance of a stock with certainty, both fundamental and technical analysis suggest that Alphabet Inc. could be a good buy for some investors, particularly those with a long-term investment horizon.
