Alphabet (GOOGL) Beats Stock Market Upswing: What Investors Need to Know

Alphabet (GOOGL) closed at $338.99 in the latest trading session, marking a +1.92% move from the prior day. The stock outperformed the S&P 500, which registered a daily gain of 0.86%. Meanwhile, the Dow gained 0.98%, and the Nasdaq, a tech-heavy index, added 0.96%.

Shares of the internet search leader have depreciated by 3.97% over the course of the past month, underperforming the Computer and Technology sector's loss of 0.56%, and the S&P 500's loss of 1.96%.

Market participants will be closely following the financial results of Alphabet in its upcoming release. The company's upcoming EPS is projected at $2.93, signifying a 2.09% increase compared to the same quarter of the previous year. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $111.44 billion, up 27.41% from the year-ago period.

For the annual period, the Zacks Consensus Estimates anticipate earnings of $20.52 per share and a revenue of $433.95 billion, signifying shifts of +89.82% and +26.55%, respectively, from the last year.

Any recent changes to analyst estimates for Alphabet should also be noted by investors. Recent revisions tend to reflect the latest near-term business trends. Hence, positive alterations in estimates signify analyst optimism regarding the business and profitability.

Our research demonstrates that these adjustments in estimates directly associate with imminent stock price performance. To capitalize on this, we've crafted the Zacks Rank, a unique model that incorporates these estimate changes and offers a practical rating system.

The Zacks Rank system, running from #1 (Strong Buy) to #5 (Strong Sell), holds an admirable track record of superior performance, independently audited, with #1 stocks contributing an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate has shifted 0.02% upward. Alphabet is currently a Zacks Rank #3 (Hold).

Digging into valuation, Alphabet currently has a Forward P/E ratio of 16.21. For comparison, its industry has an average Forward P/E of 15.96, which means Alphabet is trading at a premium to the group.

We can additionally observe that GOOGL currently boasts a PEG ratio of 0.96. The PEG ratio is similar to the widely-used P/E ratio, but this metric also takes the company's expected earnings growth rate into account. GOOGL's industry had an average PEG ratio of 1.48 as of yesterday's close.

The Internet - Services industry is part of the Computer and Technology sector. At present, this industry carries a Zacks Industry Rank of 200, placing it within the bottom 19% of over 250 industries.

The Zacks Industry Rank is ordered from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.

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This article originally published on Zacks Investment Research (zacks.com).

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