Alphabet shot up as much as 6.8% before closing up 2.8% Wednesday in hefty volume after the search giant reported strong earnings late Tuesday. Alphabet stock gave back a portion of its gain on Thursday. The tech leader is forming the right side of a cup pattern, working its way back up to its all-time high set in July.
On Thursday, the Relative Strength (RS) Rating for Alphabet stock moved into a higher percentile as it got a nine-point lift from 63 to 72. The upgraded 72 RS rating shows that Alphabet stock outperformed 72% of all stocks for price performance this past year.
In the company's earnings release CEO Sundar Pichai said, "We generated strong revenue growth in the quarter, and our ongoing efforts to improve efficiency helped deliver improved margins. I'm looking forward to driving more advances for consumers, customers and creators globally."
Alphabet Hit Fresh High In July, Faded, Now Coming Back
Alphabet stock hit an all-time high 191.75 on July 10 and consolidated. It dropped to a 147.22 low on Sept. 9 then headed north again. On Thursday, Mountain View, Calif.-based Alphabet traded around 171, down about 1.8% for the day, but up 16% from the July low.
How To Invest In Stocks In Both Bull And Bear Markets
Magnificent Seven stock Alphabet is working on a cup without handle with a 191.75 entry, its previous high. See if the stock can clear the breakout price in heavy volume. Note that it's a third-stage base. Later-stage patterns can work, but are riskier because the stock has already risen significantly.
Last quarter Alphabet earned $2.12 per share, up 28%, on 15% higher revenue at $88.3 billion. The Street expected $1.84 EPS on $86.4 billion sales.
Alphabet's quarterly EPS growth ranged from 42% down to 28% over the past year. Sales growth held steady in a 13% to 15% range during that period. According to FactSet, analyst consensus is for EPS growth to edge up to 29% this quarter, to $2.11, while sales growth eases to 11%, to $96.6 billion.
Other Ratings Shine
Among its other ratings Alphabet has an excellent 96 Composite Rating and an even better 97 EPS Rating, putting it in the top 3% of all companies for recent and long-term profit growth. Additionally, it has a B- Accumulation/Distribution Rating on an A+ to E scale. The B- rating shows that big funds are fairly heavy buyers of Alphabet stock.
Alphabet earns the No. 6 rank among its peers in the 69-stock Internet-Content industry group. Meta Platforms, Opera and Reddit are among the top 5 highly rated stocks in the group. The group itself ranks a lofty No. 22 on IBD's list of 197 industry groups.
The unique IBD Relative Strength Rating measures technical performance by using a 1 (worst) to 99 (best) score that indicates how a stock's price action over the last 52 weeks compares to the rest of the market. The market's biggest winners often have an 80 or better RS Rating as they launch their biggest price moves. See if Alphabet can continue to rebound and hit that benchmark.
Please follow James DeTar on X, formerly known as Twitter, @JimDeTar
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