Alphabet Inc. Positioned for Moderate Gains Amid Bullish Momentum and Strong Fundamentals, 2 weeks ago

Google Technical Analysis

Alphabet Inc. (Ticker: GOOGL) closed at $182.99 on July 01, 2024, marking a modest gain of 0.46% from the previous trading session. The stock experienced a price low of $181.31 and a high of $183.88, aligning closely with its established resistance level. The Relative Strength Index (RSI14) sits at 66, indicating bullish momentum but nearing overbought territory. Notably, the 50-day moving average is $172.0484, and the 200-day moving average is $147.73445, suggesting strong upward momentum over the past several months.

The Moving Average Convergence Divergence (MACD) of 1.490983 further supports bullish sentiment. The Average True Range (ATR) is 1.74, indicating moderate volatility. For short-term traders, the stop-loss is calculated at $177.12, while the support level stands at $179.63, with resistance at $183.88.

Volume analysis indicates that 15.97 million shares were traded, which is lower than the average volume of 26.31 million shares. This lower volume might suggest less conviction behind the recent price movement.

Fundamental Analysis

Alphabet Inc. boasts a formidable market cap of $2.27 trillion, positioning it as a global tech leader. With a robust Earnings Per Share (EPS) of 6.52 and a Price-to-Earnings (PE) ratio of 28.07, the stock remains reasonably valued within the tech sector. The upcoming earnings announcement scheduled for July 23, 2024, could act as a significant catalyst.

The latest news highlights Alphabet's proactive approach to election misinformation, mandating disclosures for digitally altered election ads. This move is expected to bolster the company's credibility and attract regulatory favor, potentially mitigating risks associated with misinformation.

The sentiment among analysts shows strong potential, with one strong buy, 32 buys, and four holds, culminating in a consensus rating of 'Buy.' Despite Jim Lebenthal trimming his position, Alphabet remains among Wall Street's most-loved stocks and continues to capture investor interest alongside other tech giants.

Google Markdown’s discounted cash flow (DCF) valuation stands at $201.83, suggesting that Alphabet is currently trading at a discount to its intrinsic value, offering potential upside.

Short-term and Weekly Predictions

For the next trading day (July 02, 2024), Alphabet Inc. is likely to experience moderate gains, potentially testing its resistance level at $183.88 due to ongoing bullish sentiment and technical indicators that favor upward movement.

Looking ahead to the upcoming week, the stock might consolidate within the $181-$185 range, as traders anticipate the forthcoming earnings announcement. Investors should watch for any breakouts above the resistance level or dips below the support, both of which could signal significant moves.

Intrinsic Value and Long-term Investment Potential

Based on Alphabet’s DCF valuation of $201.83, the stock presents an attractive long-term investment opportunity. The company’s continuous innovation, strategic moves to address regulatory concerns, and dominant market position underscore its potential for sustained growth.

Overall Evaluation

Given the analysis, Alphabet Inc. stands as a 'Hold' candidate. While the stock exhibits strong technical indicators and a valuation below its intrinsic value, the lower trading volume and impending earnings announcement introduce uncertainty. Investors might consider reassessing post-earnings for a clearer picture.

Check full Google forecast and analysis here.