We use cookies to understand how you use our site and to improve your experience.
This includes personalizing content and advertising.
By pressing "Accept All" or closing out of this banner, you consent to the use of all cookies and similar technologies and the sharing of information they collect with third parties.
You can reject marketing cookies by pressing "Deny Optional," but we still use essential, performance, and functional cookies.
In addition, whether you "Accept All," Deny Optional," click the X or otherwise continue to use the site, you accept our Privacy Policy and Terms of Service, revised from time to time.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Is Alphabet's (GOOGL) Stock Due for Another Bounce After Strong Q3 Results?
Read MoreHide Full Article
Reporting strong third-quarter results yesterday, Alphabet’s (GOOGL - Free Report) stock popped to a three-month high of over $180 a share before giving back some of its post-earnings gains and falling another -2% in Thursday’s trading session.
That said, GOOGL has outperformed the broader indexes over the last two years andinvestors may be wondering if it’s time to buy Alphabet’s stock for another bounce higher after impressively exceeding Q3 expectations and posting stellar quarterly growth.
Image Source: Zacks Investment Research
Alphabet’s Strong Q3 Results
Alphabet’s Q3 sales of $74.54 billion beat estimates of $72.84 billion by 2% and rose 16% from $64.05 billion in the prior-year quarter. This was driven by strong growth in its Google Services segment which includes Google Search. Higher revenue among YouTube ads and Google Cloud also attributed to Alphabet’s top line expansion with AI Infrastructure and Generative AI solutions being a significant underlying catalyst.
Taking advantage of such, Alphabet posted Q3 EPS of $2.12 which surpassed expectations of $1.83 a share by nearly 16%. More impressive, Alphabet’s Q3 earnings soared 37% from $1.55 per share in the comparative period.
Furthermore, Alphabet has now surpassed the Zacks EPS Consensus for seven consecutive quarters posting an average earnings surprise of 11.84% in its last four quarterly reports.
Image Source: Zacks Investment Research
The Case for Buying GOOGL
Starting to reconfirm projections of double-digit top and bottom line growth in fiscal 2024 and FY25, Alphabet’s valuation helps the case that now is a good time to buy GOOGL.
With Alphabet having the cheapest forward P/E valuation (22.8X) among the Magnificent 7-themed big tech stocks, it’s also noteworthy that EPS estimates are nicely up in the last 30 days for both FY24 and FY25.
Image Source: Zacks Investment Research
Final Thoughts
Investing in one of the Mag-7 tech stocks while it trades beneath the benchmark S&P 500’s 24.7X forward earnings multiple is hard to overlook. Even better, Alphabet’s stock may be poised for another bounce higher as the trend of positive earnings estimate revisions should continue following its strong Q3 results with GOOGL sporting a Zacks Rank #2 (Buy).
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Is Alphabet's (GOOGL) Stock Due for Another Bounce After Strong Q3 Results?
Reporting strong third-quarter results yesterday, Alphabet’s (GOOGL - Free Report) stock popped to a three-month high of over $180 a share before giving back some of its post-earnings gains and falling another -2% in Thursday’s trading session.
That said, GOOGL has outperformed the broader indexes over the last two years and investors may be wondering if it’s time to buy Alphabet’s stock for another bounce higher after impressively exceeding Q3 expectations and posting stellar quarterly growth.
Image Source: Zacks Investment Research
Alphabet’s Strong Q3 Results
Alphabet’s Q3 sales of $74.54 billion beat estimates of $72.84 billion by 2% and rose 16% from $64.05 billion in the prior-year quarter. This was driven by strong growth in its Google Services segment which includes Google Search. Higher revenue among YouTube ads and Google Cloud also attributed to Alphabet’s top line expansion with AI Infrastructure and Generative AI solutions being a significant underlying catalyst.
Taking advantage of such, Alphabet posted Q3 EPS of $2.12 which surpassed expectations of $1.83 a share by nearly 16%. More impressive, Alphabet’s Q3 earnings soared 37% from $1.55 per share in the comparative period.
Furthermore, Alphabet has now surpassed the Zacks EPS Consensus for seven consecutive quarters posting an average earnings surprise of 11.84% in its last four quarterly reports.
Image Source: Zacks Investment Research
The Case for Buying GOOGL
Starting to reconfirm projections of double-digit top and bottom line growth in fiscal 2024 and FY25, Alphabet’s valuation helps the case that now is a good time to buy GOOGL.
With Alphabet having the cheapest forward P/E valuation (22.8X) among the Magnificent 7-themed big tech stocks, it’s also noteworthy that EPS estimates are nicely up in the last 30 days for both FY24 and FY25.
Image Source: Zacks Investment Research
Final Thoughts
Investing in one of the Mag-7 tech stocks while it trades beneath the benchmark S&P 500’s 24.7X forward earnings multiple is hard to overlook. Even better, Alphabet’s stock may be poised for another bounce higher as the trend of positive earnings estimate revisions should continue following its strong Q3 results with GOOGL sporting a Zacks Rank #2 (Buy).