What Happened to the GOOG Stock Price Today?
- Alphabet (NASDAQ:GOOGL, NASDAQ:GOOG) stock rose after the internet giant reported first-quarter 2020 numbers that impressed on all fronts.
- GOOG stock is now up an impressive 36% year-to-date, far outpacing the broader Nasdaq-100, which is up just 8% in 2021.
- This follows a 2020 wherein GOOG stock lagged the Nasdaq-100, with the former rising 31% and the latter surging 48%.
- Could GOOG stock be on the verge of a big 2021 breakout?
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Alphabet Earnings: YouTube Reigns Supreme
- Alphabet’s Q1 earnings were very strong, and underscores that this company is a big beneficiary amid the global economic reopening.
- YouTube was mentioned 33 times on Alphabet’s earnings call.
- A billion hours are streamed everyday on YouTube, which is 2.5X Netflix’s daily streamed hours.
- Topline metrics looked great. Revenues rose 32%. Google Search revenues rose 30%. YouTube revenues rose 49%. Google Cloud revenues rose 46%.
- Margin expansion was impressive. Alphabet’s operating margins clocked in at 30%, up 11 points year-over-year and the highest operating margin Alphabet has reported in years.
- Operating income more than doubled year-over-year.
- Management largely expects this robust growth to persist for the foreseeable future.
- That’s great news for GOOG stock.
Does It Matter?
- It appears Alphabet is on the right side of the reopening trade.
- That is, many work-from-home and digital media companies will see their growth rates decelerate meaningfully in 2021 as the world gets back to “normal” and becomes less reliant on technology than it was in 2020.
- Alphabet has exposure to those headwinds. But it has far more exposure to the tailwinds from a big rebound in ad spending that will come with improving economic activity in 2021.
- That’s why, as the economy gradually normalized in early 2021, Alphabet reported some its best growth numbers in several years.
- We expect this trend to persist. Alphabet’s advertising, cloud, and hardware businesses will remain very healthy as economic activity rebounds over the next few years. As that happens, GOOG stock should keep powering higher.
GOOG Stock Price Forecast
- GOOG stock remains incredibly cheap for a digital media stock.
- Most stocks in this space are trading at 50X or greater forward earnings multiples, and 10X or greater forward sales multiples.
- Alphabet stock trades at just 25X forward earnings and just 5X forward sales.
- These discounted multiples should couple with healthy revenue growth in 2021 to spark a nice rally in GOOG stock. Our numbers indicate that shares have visible upside to $3,000 over the next 12 months.
Alphabet stock is a great growth stock to buy and hold for the long haul. But the reality is that most of the money in this name has already been made. Everyone already uses Google. Every investor is already long GOOG. The company already has a market cap of $1.6 trillion.
So, while GOOG stock is a great long-term buy, it’s far from the best stock to buy if you’re looking to score 5X, 10X, or even 20X gains in the stock market.
If you’re looking for those kinds of gains, you have to look where no one else is looking — at small, emerging stocks with breakthrough technologies that could change the world, but which no one knows about or is talking about today.
Buying those small tech stocks today could be like buying GOOG stock a decade ago… before it soared thousands of percent.
Identifying these breakout small tech stocks before anyone else — and scoring 10X or bigger gains — is my specialty. That’s my niche in the market. Finding small tech stocks with huge breakout potential first is how I picked names like Advanced Micro Devices (NASDAQ:AMD), Chegg (NASDAQ:CHGG), Tesla (NASDAQ:TSLA), NIO (NYSE:NIO), Plug Power (NASDAQ:PLUG), Shopify (NYSE:SHOP), Square (NYSE:SQ), and many more before most other folks even knew they existed — and scored bigger than 10X gains in all those names.
But these days, my focus is on a whole new set of emerging tech companies that have enormous long-term upside potential. Companies that could be the next AMD, the next Netflix, the next Tesla, and so on.
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On the date of publication, Luke Lango did not have (either directly or indirectly) any positions in the securities mentioned in this article.
By uncovering early investments in hypergrowth industries, Luke Lango puts you on the ground-floor of world-changing megatrends. It’s how his Daily 10X Report has averaged up to a ridiculous 100% return across all recommendations since launching last May. Click here to see how he does it.
