Alphabet Likely to Post Double-Digit Growth in Q4 Earnings and Revenue

The parent of Google and the world’s largest search engine that dominates internet search activity globally, Alphabet, is expected to report its fourth-quarter earnings of $26.71 per share, which represents year-over-year growth of about 20% from $22.3 per share seen in the same period a year ago.

The Mountain View, California-based internet giant would post revenue growth of nearly 30% to around $59.3 billion. It is worth noting that the company has consistently beaten consensus earnings estimates in the last two years, at least.

Alphabet stock was trading 2.52% lower at $2,550.41 on Tuesday. The stock slumped nearly 12% so far this year after surging over 65% in 2021.

Analyst Comments

“Continued platform-level innovation on retail search and YouTube; as well as underappreciated products driven by mobile search and Maps may lead to further Website growth in ’23. Continued expense discipline leads to operating leverage and upward revisions on EPS estimates,” noted Brian Nowak, equity analyst at Morgan Stanley.

“AlphaWise data show how Alphabet’s (GOOGL) innovation continues to drive more consumers to start their online shopping on GOOGL, giving us more confidence in its multi-year e-comm ad growth. This change is true even for Prime members, who seem to be starting less frequently on Amazon.com, a trend to monitor.”

Alphabet Stock Price Forecast

Twenty-eight analysts who offered stock ratings for Alphabet in the last three months forecast the average price in 12 months of $3,386.25 with a high forecast of $3,925.00 and a low forecast of $2,965.00.

The average price target represents a 32.00% change from the last price of $2,565.38. From those 28 analysts, 27 rated “Buy”, one rated “Hold” while none rated “Sell”, according to Tipranks.

Morgan Stanley gave the base target price of $3430 with a high of $3840 under a bull scenario and $2395 under the worst-case scenario. The investment bank gave an “Overweight” rating on the internet giant’s stock.

Several other analysts have also updated their stock outlook. UBS cut the target price to $3,800 from $3,925. BofA Global Research raised the price objective to $3,470 from $3,210. Cowen and company lifted the target price to $3,500 from $3,360.

Technical analysis also suggests it is good to hold for now as 100-day Moving Average and 100-200-day MACD Oscillator shows a mixed signal.

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