Alphabet Inc. (GOOGL), headquartered in Mountain View, California, is a holding company, the largest of which is Google, renowned for its dominance in the worldwide search engine market. Valued at $2.15 trillion by market cap, the company has evolved from a search engine provider to offer cloud computing, healthcare, internet services, and various other products and services.
Companies worth $200 billion or more are generally described as “mega-cap stocks,” and GOOGL fits right into that category. GOOGL surged back into the $2 trillion valuation club after reporting strong Q1 results and its inaugural dividend. The company is the fourth most valuable publicly traded company in the world after Microsoft (MSFT), Apple Inc. (AAPL), and NVIDIA Corporation (NVDA).
The tech conglomerate has fallen 2.8% from its 52-week high of $178.77, which it hit on May 20. Shares of GOOGL are up 31.6% over the past three months, outperforming the Nasdaq Internet Invesco ETF (PNQI), which registered a 2.1% gain over the same time frame.
Longer term, GOOGL shares rose 38.8% over the past year, and in 2024, the stock is up 25.2%. By contrast, the PNQI is up 9.7% on a YTD basis and 30.2% over the past 52 weeks.
To confirm the bullish price trend, GOOGL has been trading above its 50-day moving average since mid-March and 200-day moving average since early March.
On Apr. 26, GOOGL shares surged more than 11% in pre-market trading after the company reported Q1 results that exceeded analysts' expectations. The company also reported its first-ever dividend of $0.20 per share and announced an additional buyback worth $70 billion.
GOOGL’s recent outperformance can also be attributed to the unveiling of new AI products and features at its Google I/O developer conference on May 14. Despite concerns that its dominance in the search engine market could decline following the rise of AI, the company has announced that it will incorporate AI overlays into Google search. The company’s Gemini AI model is also expected to be incorporated into its various products.
After its recent outperformance compared to the internet industry, analysts remain optimistic about GOOGL’s prospects. The stock has a consensus rating of “Strong Buy” from the 44 analysts covering it, and the mean price target of $194.89 is a 12.1% premium to current levels.
On the date of publication, Dipanjan Banchur did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
