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Alphabet Class C
(NASDAQ:GOOG)
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Rating:76Outperform
Price Target:
$407.00
▲(27.55% Upside)
Action:Reiterated
Date:07/23/26
GOOG scores well primarily due to strong underlying financial performance (high profitability and low leverage) and a constructive earnings outlook driven by AI and Cloud momentum, including a large and growing Cloud backlog. The score is held back by near-term cash flow pressure tied to elevated CapEx and weaker free-cash-flow conversion, plus bearish technical signals with the stock trading below key moving averages.
Positive Factors
High Profitability & Margins
Alphabet’s very high and improving margins reflect durable operating leverage from scale in search, YouTube and growing cloud services. Strong margin profile supports sustained R&D and AI investment, enabling long-term product differentiation and healthy return on capital even as growth moderates.
Negative Factors
Elevated CapEx & Free Cash Flow Pressure
Management’s multi-year increase in infrastructure spending to capture AI compute leads to notably weaker free cash flow conversion. Persistent elevated CapEx can constrain discretionary capital for buybacks/dividends and compress near- to medium-term cash returns despite strong operating cash flow.
Read all positive and negative factors
Positive Factors
Negative Factors
High Profitability & Margins
Alphabet’s very high and improving margins reflect durable operating leverage from scale in search, YouTube and growing cloud services. Strong margin profile supports sustained R&D and AI investment, enabling long-term product differentiation and healthy return on capital even as growth moderates.
Read all positive factors
Alphabet Class C Key Performance Indicators (KPIs)
Any
Revenue by Geography
Lists revenue by country or region to highlight concentration in the U.S., growth trends internationally, and exposure to currency swings or regulatory headwinds that could affect top‑line performance.
Lists revenue by country or region to highlight concentration in the U.S., growth trends internationally, and exposure to currency swings or regulatory headwinds that could affect top‑line performance.
Data provided by:
The Fly
The FlyAlphabet Class C (GOOG) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$4.36T
Dividend Yield0.24%
Average Volume (3M)21.97M
Price to Earnings (P/E)17.7
Beta (1Y)1.20
Revenue Growth20.23%
EPS Growth112.71%
CountryUS
Employees190,820
SectorCommunication Services
Sector Strength97
IndustryInternet Content & Information
Share Statistics
EPS (TTM)20.14
Shares Outstanding5,527,000,000
10 Day Avg. Volume20,988,777
30 Day Avg. Volume21,968,450
Financial Highlights & Ratios
PEG Ratio0.84
Price to Book (P/B)9.13
Price to Sales (P/S)9.41
P/FCF Ratio51.76
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$430.70Price Target Upside34.98% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering12
EPS Forecast (FY)20.26
Revenue Forecast (FY)$495.34B
Alphabet Class C Business Overview & Revenue Model
Company Description
Alphabet Inc. operates globally, providing a wide array of products and digital platforms to customers across the United States, Europe, the Middle East, Africa, the Asia-Pacific region, Canada, and Latin America. The company's business is organiz...
How the Company Makes Money
Alphabet primarily makes money through advertising and, to a smaller extent, through cloud services, platform fees, hardware sales, and other bets.
1) Advertising (largest revenue stream)
- Google Search & other: Alphabet sells advertising tied t...
Alphabet Class C Earnings Call Summary
Earnings Call Date:Jul 22, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Oct 27, 2026
Earnings Call Sentiment Positive
The call conveyed strong positive momentum driven by AI adoption: robust top-line growth (24% consolidated; Cloud +82%), improving margins, large Cloud backlog ($514B), and high user and developer engagement for Gemini and AI products. Management emphasized ambitious investments (higher CapEx, TPU deployments) to capture long-term opportunities, but also warned of supply constraints, elevated near-term expenses, negative quarterly free cash flow, and some margin pressure from using third-party capacity. Overall, the positives (strong growth, profitability, AI adoption and scale) notably outweigh the near-term investment- and supply-related headwinds.Positive Updates
Strong Consolidated Revenue and Profitability
Consolidated revenues of $119.8 billion, up 24% year-over-year; operating income increased 30% to $40.8 billion and operating margin expanded to 34%.
Negative Updates
Supply Constraints and Capacity Allocation
Management repeatedly flagged a supply-constrained environment for AI compute and TPUs; company will expand third-party capacity in Q3 as a bridging strategy, which is expected to create modest near-term margin pressure.
Read all updates
Q2-2026 Updates
Positive
Negative
Strong Consolidated Revenue and Profitability
Consolidated revenues of $119.8 billion, up 24% year-over-year; operating income increased 30% to $40.8 billion and operating margin expanded to 34%.
Read all positive updates
Company Guidance
Alphabet updated full‑year 2026 guidance and near‑term outlook: CapEx is increased to $195–$205 billion (from $180–$190B), with Q2 CapEx at $44.9B (≈60% servers, 40% data center/networking); management expects a slight FX headwind in Q3 versus a 1‑percentage‑point FX tailwind in Q2 and will expand use of third‑party capacity in Q3 (causing modest near‑term margin pressure). Google Cloud backlog rose to $514B (up >$50B sequentially) and the company expects to recognize just over 50% of that backlog as revenue over the next 24 months, while most revenues from TPU system sales will be realized in 2027 (only a small amount recognized in 2026). Free cash flow is expected to remain under pressure from infrastructure investment (Q2 FCF was negative $5.9B; trailing‑12‑month FCF $53.3B), and Alphabet ended the quarter with $242.5B in cash & marketable securities and $98.2B of long‑term debt; the Board also declared a $0.22/share quarterly dividend.Alphabet Class C Financial Statement Overview
Summary
Income Statement
93
Very Positive
Balance Sheet
90
Very Positive
Cash Flow
78
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 445.93B | 402.96B | 350.02B | 307.39B | 282.84B | 257.64B |
| Gross Profit | 271.58B | 240.43B | 203.71B | 174.06B | 156.63B | 146.70B |
| EBITDA | 325.74B | 179.96B | 135.39B | 97.97B | 85.16B | 103.52B |
| Net Income | 244.21B | 132.17B | 100.12B | 73.80B | 59.97B | 76.03B |
Balance Sheet | ||||||
| Total Assets | 921.98B | 595.28B | 450.26B | 402.39B | 365.26B | 359.27B |
| Cash, Cash Equivalents and Short-Term Investments | 242.47B | 126.84B | 95.66B | 110.92B | 113.76B | 139.65B |
| Total Debt | 112.76B | 59.29B | 25.46B | 27.12B | 29.68B | 28.51B |
| Total Liabilities | 281.50B | 180.02B | 125.17B | 119.01B | 109.12B | 107.63B |
| Stockholders Equity | 640.48B | 415.26B | 325.08B | 283.38B | 256.14B | 251.63B |
Cash Flow | ||||||
| Free Cash Flow | 53.27B | 73.27B | 72.76B | 69.50B | 60.01B | 67.01B |
| Operating Cash Flow | 185.68B | 164.71B | 125.30B | 101.75B | 91.50B | 91.65B |
| Investing Cash Flow | -225.38B | -120.29B | -45.54B | -27.06B | -20.30B | -35.52B |
| Financing Cash Flow | 74.97B | -37.39B | -79.73B | -72.09B | -69.76B | -61.36B |
Alphabet Class C Technical Analysis
Positive
319.09
Price Trends
355.87
Positive
347.25
Positive
327.01
Positive
Market Momentum
0.78
Negative
54.27
Neutral
85.55
Negative
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GOOG, the sentiment is Positive. The current price of 319.09 is below the 20-day moving average (MA) of 347.98, below the 50-day MA of 355.87, and below the 200-day MA of 327.01, indicating a bullish trend. The MACD of 0.78 indicates Negative momentum. The RSI at 54.27 is Neutral, neither overbought nor oversold. The STOCH value of 85.55 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GOOG.
Alphabet Class C Risk Analysis
Alphabet Class C disclosed 28 risk factors in its most recent earnings report. Alphabet Class C reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Alphabet Class C Peers Comparison
UnderperformOutperform
Sector (60)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
83 Outperform | $3.45T | 25.82 | 35.39% | 0.93% | 17.79% | 31.42% | |
76 Outperform | $4.36T | 17.68 | 50.84% | 0.27% | 20.23% | 112.71% | |
75 Outperform | $4.54T | 35.26 | 137.18% | 0.32% | 14.24% | 32.57% | |
73 Outperform | $1.42T | 20.69 | 29.73% | 0.35% | 27.65% | -5.02% | |
60 Neutral | $48.67B | 4.58 | -11.27% | 4.14% | 2.83% | -41.78% | |
58 Neutral | $374.09B | 21.87 | 50.59% | 1.74% | 17.35% | 32.98% | |
47 Neutral | $37.33B | 758.86 | 0.13% | ― | -2.40% | -98.39% |
* Communication Services Sector Average
GOOG
Alphabet Class C
360.13
163.77
83.40%
AAPL
Apple
311.00
98.59
46.42%
BIDU
Baidu
111.11
24.30
27.99%
META
Meta Platforms
588.77
-180.70
-23.48%
MSFT
Microsoft
487.46
-33.32
-6.40%
ORCL
Oracle
144.39
-109.15
-43.05%
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.