Alphabet (GOOG, GOOGL) 02 (Aug 17 - Dec 25)

[winston]

vested

Alphabet's first-quarter sales fall short of expectations

by Emily McCormick

Advertising revenue for the period was $30.72 billion, lighter than the $32.64 billion expected and the $32.6 billion the company posted during the fourth quarter of 2018.

Source: Yahoo Finance

https://finance.yahoo.com/news/alphabet ... 38683.html

[winston]

vested

Alphabet's first-quarter sales fall short of expectations

by Emily McCormick

Advertising revenue for the period was $30.72 billion, lighter than the $32.64 billion expected and the $32.6 billion the company posted during the fourth quarter of 2018.

Source: Yahoo Finance

https://finance.yahoo.com/news/alphabet ... 38683.html

[winston]

vested

Google Rises On Upgrade - But Is It Premature?

By Steve Millere

Deutsche Bank stock analyst Lloyd Walmsley raised his price target on Alphabet to $1400, which is a 25% premium on yesterday’s closing price.

His optimism is based on the possibility to generate additional revenue by placing ads on the new Google Discover feed on Android phones.

We are looking for a pullback in the next month, testing recent low near, near $1100, then up into the summer.

Source: Investing.com

https://www.investing.com/analysis/goog ... -200421968

[winston]

vested

Alphabet Stock Is Just Too Cheap After Its Recent Selloff

The tech giant remains an absolute cash cow with over $113 billion on the balance sheet and trades for a reasonable 25x forward earnings. The post-earnings selloff is overdone.

by Nicholas Ward

It still posted 17% year over year sales growth.

Source: The Street

https://www.thestreet.com/investing/sto ... yptr=yahoo

[winston]

vested

May 18, 2019

Alphabet Spells Big Future Profits With Just 2 Letters: AI

by Jon Markman

A report from Canalys in February showed the $80 billion market for cloud infrastructure is currently dominated by Amazon Web Services. The Amazon.com subsidiary commands 32% market share. Microsoft unit Azure takes 16%, and Alphabet’s Google Cloud is a distant third, with only 9% share.

Shares now trade at 21.9x forward earnings. Given the resilience of Alphabet’s core advertising business, and the bright longer-term prospects for its cloud business, this is cheap.

Based on high-teens sales growth, this stock could trade to the $1,400 level in two years.

At their current price of $1,175, that’s a nice 20% potential increase for a stock with a four-digit price tag.

Source: Forbes

https://www.forbes.com/sites/jonmarkman ... 8b1a386d9e

[winston]

Justice Dept. preparing antitrust probe of Google

The search giant was fined a record $2.72 billion by European regulators in 2017 for abusing its dominance of the online search market.

In the U.S., the Federal Trade Commission made an antitrust investigation of Google but closed it in 2013 without taking action.

In addition to the 2017 record fine, European regulators also slapped a $1.7 billion penalty on the company in March for barring websites from selling ads from rivals alongside some Google-served ads near search results. Google says it has now ended that practice.

Google commands the lead in digital ad revenue by a wide margin, controlling 31.1% of global digital ad dollars, according to eMarketer's 2019 estimates. Facebook is a distant second with 20.2%.

Source: Associated Press

https://finance.yahoo.com/news/reports- ... 50854.html

[winston]

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GROWTH AT REASONABLE PRICE –
ATTRACTIVE ENTRY POINT

We reiterate our Buy rating (as of 2 May 2019) due to undemanding valuation (EV/EBITDA 11x on 2020 estimates) and continued structural growth opportunities as well as operating profit growth of 15%-20% p.a. in the years ahead.

The share price pullback due to the revenue growth uncertainty as a result of advertising changes provides an attractive entry point, in our view.

Source: Julius Baer

[winston]

vested

Alphabet (GOOG, GOOGL)

Notable Risks: Potential decline in ad revenues, antitrust issues, government regulation and broader tech market weakness

Expected Price Range: $940-$1,090

Google’s dominant core business is “search,” where it has 90% market share globally. In recent years, it has also been incubating other “moonshot” ventures, such as Weymo, the self-driving car business or CapitalG, the late-stage venture capital arm, that could eventually become the next Google.

Income from digital advertising, which mostly consists of its search and YouTube ecosystem, contributes to over 80% of revenues.

Investors are especially concerned that the group’s core advertising business is likely to be at a plateau. They are now watching Amazon’s (NASDAQ:AMZN) increased presence in the market closely.

In 2018, Google’s ad business grew 20% and was outpaced by both Facebook (NASDAQ:FB) at 30% and Amazon at 95%. In other words, GOOGL is likely to face more competition in the future from them. Therefore Google’s advertising revenue may take a hit, especially if the U.S. economy cools down in the months ahead.

Many analysts are also concerned about YouTube, once a crown jewel and currently a big headache. During the earnings call of April 29, Alphabet CFO Ruth Porat announced various changes to YouTube so that the company could better curb the spread of toxic content, such as fake news and conspiracy theories. The result of the problems and the efforts to tame the issues has been loss of advertising revenue on YouTube.

Therefore, long-term investors are likely to wait for the next earnings report in late July to see how revenue has fared amid the competition from Facebook and Amazon.

There seems to be bipartisan support for cracking down on big tech and many in the U.S. would like to see it it broken up.

In the coming weeks, if we have more headlines that suggest a long governmental probe into anti-competitive practices by the company, Alphabet stock is likely to decline to the triple digits, possibly towards the low-$900 level.

Source: Investor Place

[winston]

vetsed

Alphabet (GOOGL)
63% share of industry US sales

Looking back, GOOGL has almost doubled in value over the last five years. But that doesn’t mean there isn’t further upside potential ahead.

GOOGL still retains a bullish ‘Strong Buy’ Street consensus. What’s more, the $1,334 average analyst price target indicates upside potential of over 22%. That’s despite more anti-trust talk from regulators, with Makan Delrahim (Assistant AG, DOJ) suggesting that stricter regulation may be coming.

“Investors may be getting relatively comfortable with the underlying regulatory risk given that so far, the financial performance at FB, GOOGL and AMZN continues to be in line or even better than what the Street has been expecting” notes top-rated SunTrust Robinson analyst Youssef Squali.

Given the complexity and global considerations of regulating and/or breaking up big tech, Squali is confident that it is likely to take years for regulatory measures to be implemented, and even longer for them to start impacting the financials of these companies.

What’s more there is a growing realization that even in case of a break-up of a behemoth like GOOGL, the value of the parts may be higher than the whole over time.

For example, Needham analyst Laura Martin has just reiterated her GOOGL buy rating with a $1,350 price target. She has calculated that the company could be worth nearly 50% more than its current valuation in the case of a break-up.

Martin values Google search at $600 per Alphabet share, YouTube at $200, and the Android App Store at $100. Plus there are extra contributions from Gmail, Maps, Waymo, DeepMind etc.

“Elevated regulatory scrutiny adds costs and margin pressures for 2-4 years, but probably has little impact on revenue growth or consumer usage until outcomes are determined and then fought out in the courts,” she concluded.

Source: GS

[winston]

vested

This Stock is Still a Buy (and Still Has Plenty of Growth Ahead)

by Stephen Mack

70,000+ employees, market cap >$750 billion and nearly $150 billion in annual revenue.

As for last quarter’s results, Alphabet’s earnings per share (EPS) was about 10% below expectations. That’s not great, but keep in mind that over the previous four quarters, Alphabet beat expectations by an average of 27%. And yet, the stock price is still slightly lower than it was five quarters ago.

Source: Money Morning

https://dailytradealert.com/2019/06/29/ ... wth-ahead/