Alphabet (GOOG, GOOGL)

[winston]

not vested

GOOGLE inc. - Stock Analyst Research
Target Price* 154.00
Recommendation ACCUMULATE

Alphabet Inc. - AI underpinning ad growth

4Q23 results were within expectations. FY23 revenue/PATMI were at 100%/98% of our FY23e forecasts. 4Q23 PATMI grew 52% YoY on higher operating leverage.

Advertising is still on the rebound, with 11% YoY growth improving sequentially for a 4th straight quarter. APAC retail strength was the standout again. FY24e CAPEX levels are expected to be significantly higher vs FY23 as GOOGL continues to scale its technical infrastructure to support AI development.

We cut our FY24e PATMI by ~5% as a result of increasing R&D investments in AI. Due to recent price action, we downgrade to ACCUMULATE from BUY, but raise our DCF target price to US$154 (prev. US$144) as we roll-over an additional year of valuations, with an unchanged WACC of 7.3% and terminal growth rate of 3.5%.

We expect GOOGL to remain the market leader in digital advertising by leveraging AI for product improvements and efficiencies, while also being well positioned to capture more eyeballs through YouTube and connected TV.

Source: Phillips

https://www.poems.com.sg/stock-research/GOOGL/

[winston]

not vested

Alphabet Inc. (GOOG) – Tuesday, January 30

Alphabet bested analysts’ expectations for its fourth-quarter earnings and sales results Tuesday evening.

The company reported earnings of $1.64 per share and sales of $86.31 billion, up from earnings of $1.05 per share and revenue of $76.04 billion a year ago.

Analysts were calling for earnings of $1.60 per share and $85.28 billion in sales.

Digging a little deeper into the report… YouTube ad revenue came in at $9.2 billion, in line with analysts’ estimates for $9.21 billion. That’s also up by 15.7% from revenue of $7.95 billion in the same quarter a year ago.

Additionally, Google Cloud revenue increased 25.6% year-over-year to $9.19 billion, besting analysts’ estimates for $8.94 billion.

Alphabet’s CEO, Sundar Pichai, stated:

We are pleased with the ongoing strength in Search and the growing contribution from YouTube and Cloud. Each of these is already benefiting from our AI investments and innovation. As we enter the Gemini era, the best is yet to come.

Now, in case you were wondering, Pichai wasn’t referring to a horoscope. Rather, Gemini is the company’s AI language model, which launched last month. But the heart of the tech giant’s business is ad revenue.

And in the company’s latest earnings report, ad revenue was up 10.9% year-over-year to $65.5 billion but missed analyst expectations of $65.8 billion.

Despite beating estimates on the top and bottom lines, GOOG shares fell about 2.5% on Wednesday. Unfortunately, Wall Street couldn’t get past the missed ad revenue expectations.

Source: Market 360

[winston]

not vested

The Magnificent Seven stock to buy hand over fist in February: Alphabet

Arguably the biggest concern for Alphabet is that nearly 76% of its $86.3 billion in total revenue from 2023 came from advertising.

Google accounts for 91.5% of worldwide internet search share.

Daily views of YouTube Shorts catapulted from 6.5 billion in 2021 to more than 50 billion by early last year.

Google Cloud just delivered its fourth consecutive quarter of operating income following years of operating losses. Enterprise cloud spending is still in its early innings, which suggests there's a double-digit, exceptionally high-margin growth opportunity to be had with cloud infrastructure services.

But the top selling point for Alphabet might just be that it remains cheap. Its forward price-to-earnings (P/E) ratio of 18 is actually lower than the forward P/E of the benchmark S&P 500 -- despite Alphabet's offering a higher growth rate.

Furthermore, it's valued at less than 13 times forward-year cash flow, which compares to an average cash flow multiple of 18 times over the previous five years.

Tack on a $97.7 billion net cash buffer and it's easy to see why Alphabet is a screaming bargain in February (and beyond).

Source: TMF

[winston]

not vested

Here's Why I'm Buying the Dip on Alphabet's Stock

by Keithen Drury

Q4 was solid all around for Alphabet

Advertising revenue makes up 76% of Alphabet's total.

Alphabet's Ad revenue increasing 11%.

YouTube: Ad revenue increased by 16%.

Google Cloud's revenue rose 26% in Q4 to $9.2 billion, with an operating margin of 9%.

Source: The Motley Fool

https://finance.yahoo.com/news/heres-wh ... 00014.html

[behappyalways]

PR Scramble: Google CEO Blasts "Unacceptable" AI Gemini Amid Boycott Calls
https://www.zerohedge.com/technology/pr ... cott-calls

[winston]

not vested

Here's Why It May Be Time To Sell Shares Of Google Stock

by VIDYA RAMAKRISHNAN

Google stock triggered two sell rules after fourth-quarter results.

Its technical ratings are weakening as competition from Microsoft heats up.

Source: IBD

https://www.investors.com/research/goog ... src=A00220

[behappyalways]

Gartner speculates that search engine volume will drop 25% by 2026, due to AI chatbots and virtual agents.

This is a big problem for Google, as their AI game is struggling hard
https://twitter.com/Mayhem4Markets/stat ... 5593707862

[behappyalways]

Alphabet Shares Higher On Report Apple In Talks To License Gemini For iPhones
https://www.zerohedge.com/technology/al ... ni-iphones

[behappyalways]

Google Eyes Paid AI Search Features, Explores Subscription Model; Report
https://www.zerohedge.com/technology/go ... del-report

[winston]

not vested

1Q Earnings

Alphabet: Search advertising may be Google’s big moneymaker but growth in that business has stalled in the single digits in recent years.

The rise of generative AI threatens to further dent the search business — it’s not at all clear whether ads will play as central of a role in a world where people get their information by conversing with an AI chatbot.

What kind of near-term and medium-term growth prospects does Alphabet’s management foresee for the company’s foundational search business?

Source: Fortune