Sign InAlphabet Inc.'s Stock Shows Strong Performance, Potential for Growth
Summary
Alphabet Inc.'s stock (GOOG) shows strong performance with a significant rise in price, elevated investor interest, and positive fundamentals, but caution should be exercised due to a slightly bearish MACD and high RSI, making it a 'Hold' for now but potentially a 'Buy' in the future if earnings exceed expectations and the class-action lawsuit doesn't pose a significant risk (as of July 26, 2023).
Fundamental Stock Analysis
Alphabet Inc.'s (GOOG) latest close on July 26, 2023, was at $129.66, with a significant rise of $6.87 (5.59%) on that day. The stock has shown a strong performance with a 52-week high and low of $131.37 and $83.45 respectively. The company's market capitalization is approximately $1.64 trillion, which places it amongst the largest corporations globally.
GOOG’s volume on the last trading day was approximately 45.98 million, which is significantly higher than its average volume of 26.25 million. This increased activity could indicate that investors are showing elevated interest in the stock. Additionally, the reported earnings per share (EPS) of $4.39 and a Price to Earnings ratio (PE) of 29.54 show that Alphabet is profitable and its earnings valuation is fairly in line with the industry average.
The company is due to announce its earnings on October 23, 2023. Ahead of this announcement, investors may want to keep an eye on the current discounted cash flow (DCF) figure of $131.32, which offers an estimate of the company's intrinsic value and hints that the stock may be undervalued at the current price level.
Technical Stock Analysis
The Relative Strength Index (RSI14) of Alphabet stands at 65, which suggests it's nearing an overbought position. The stock's 50-day moving average ($122.50) and 200-day moving average ($104.09) both lie below the current stock price, suggesting a bullish trend in the short and medium terms.
However, the MACD (3-month) is reported as -0.29, hinting at possible bearish momentum in the near term. Analyst consensus targets for GOOG are optimistic, with a high target of $312, a low target of $115, and a median target of $145.
Recent News Coverage
Recent news updates highlight Alphabet's potential growth drivers and challenges. The company is recognized as a leader in AI innovations and highlighted as a stable holding for long-term investors. A class-action lawsuit relating to overcharging advertisers raises some concerns, yet it's too early to assess its impact. Alphabet's self-driving unit, Waymo, is refocusing its efforts by prioritizing ride-hailing services and delaying its autonomous trucking initiative. Finally, a top-level management reshuffling with CFO Ruth Porat taking over as the chief investment officer is noteworthy.
Stock Prediction and Final Evaluation
Based on the available information, the stock is expected to continue its upward direction on the next trading day, holding above the 50-day and 200-day moving averages. For the upcoming week and in medium term, however, careful attention should be paid to the slightly bearish MACD and high RSI.
Given the healthy fundamentals, the technological leadership, and profitable diversified businesses, Alphabet Inc.'s stock is a 'Hold' for now. If the upcoming earnings release outperforms expectations and the class-action lawsuit doesn't pose a significant risk, Alphabet can very well become a 'Buy'.
