Sign InSummary
As of July 10, 2023, Alphabet Inc.'s stock price experienced a slight decrease, but the company's strong foothold in AI and potential for growth make it a favorable investment for the long term, despite potential short-term volatility. (Date of analysis: July 10, 2023)
Stock Analysis for Alphabet Inc. (Ticker: GOOGL)
Technical Analysis
As of July 10, 2023, Alphabet Inc. last closed at $116.45 on the NASDAQ exchange, reflecting a 2.54% decrease from the previous trading day. The stock price recorded a daily low and high of $116.14 and $118.3, respectively. Looking at technical indicators, the 14-day Relative Strength Index (RSI14) stands at 33, indicating the stock is currently neither oversold nor overbought. The Moving Average Convergence Divergence (MACD) is negative (-1.42), implying bearish momentum.
However, assessing from the trajectory of moving averages, we identify bullish longer-term trends. The stock’s 200-day moving average sits at $102.28, whereas the 50-day moving average rests significantly higher at $118.81, suggesting an upward trend. In terms of price range, the yearly high and low for Alphabet Inc. were $129.04 and $83.34, respectively.
Fundamental Analysis
Alphabet Inc. currently has a market capitalization of $1.49 trillion, signifying its substantial size and influence in the market. With a Price-to-Earnings (PE) ratio of 26.12, the stock trades at a valuation slightly higher than some industry competitors. The company has an Earnings per Share (EPS) of $4.49, demonstrating strong profitability per share.
Furthermore, the discounted cash flow (DCF) value of $118.94 per share slightly outweighs the last close price, which could suggest the stock is somewhat undervalued.
Analysts' target consensus for the stock is set at $139.44, with target high and low at $190 and $114 respectively. This wide range paints a varied picture of future expectations.
News Analysis
Recent news reveals growing investor interest in Alphabet Inc. for its significant role in the development of Artificial Intelligence (AI). This surge in attention is possibly due to a mixture of reasons, a prominent one being Alphabet's DeepMind exploring new AI avenues. Additional news highlights Alphabet's position in AI, emphasizing how it could be a major growth driver in the coming years.
Stock Prediction
In the short-term (next trading day on July 11, 2023), considering the negative MACD value, coupled with recent downward pressure, the price may experience slight bearish movements. However, longer-term factors, such as moving averages and broader market attention towards AI, could potentially influence a positive outcome for the week.
Conclusion
Given Alphabet Inc.'s strong foothold in AI and the potential this technology has to drive growth, the stock's long-term prospects look appealing. However, short-term technical indicators suggest possible volatility.
Considering all factors, Alphabet Inc.'s stock is deemed a "Hold" for short-term investors due to slight bearish indications, while a "Buy" for long-term investors based on the company's favorable prospects in AI and its DCF value. Although current market price is slightly undervalued, investors should keep an eye on the upcoming earnings announcement on July 24, 2023, which has the potential to reposition the stock.
