Technology
How Analysts Rate Alphabet Now After Earnings and After Outsizing Apple
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Alphabet Inc. (NASDAQ: GOOGL) reached a milestone after earnings in the first week of February by overtaking Apple Inc. (NASDAQ: AAPL) as the world’s largest company by market capitalization. That was short-lived but impossible to ignore.
24/7 Wall St. wanted to see just how much more upside awaits the Google (sorry, Alphabet — old habits are hard to break) stock price. This was also a new report format because it broke out the moonshots and traditional operations. Alphabet still offers very little for its earnings guidance ahead.
The company had $8.67 in earnings per share (EPS) on $21.33 billion in revenue, compared to the consensus estimates from Thomson Reuters of $8.10 in EPS on revenue of $20.77 billion. The same period from the previous year had EPS of $6.76 and $18.10 billion in revenue. Aggregate paid clicks increased by 31% from the fourth quarter of 2014, and it was up by 17% sequentially. The aggregate cost-per-click also grew on the year-over-year basis by 13%.
Alphabet had just over $73 billion in cash and equivalents. Its shares closed up 1.2% at $770.77 on Monday ahead of earnings but initially popped up 7% or so after the earnings report, taking its $517.5 billion in market cap to around $553 billion or so — passing up Apple’s nearly $540 billion market cap. The problem is that investors were selling the FANG stocks this past week, and Google closed down 3.6% (some $26.27) at $703.76 on Friday for a market cap of $460 billion. Apple’s end-of-week price of $94.02 yields a market cap near $507 billion.
At $703.76, Alphabet has a 52-week trading range of $527.55 to $810.35. Its consensus analyst target from Thomson/First Call is roughly $924.00 (and rising). That consensus target was closer to $861 immediately before earnings.
Deutsche Bank’s $1,080 price target is the street high from all analysts. Alphabet’s lowest analyst price target is now $800.
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