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Alphabet Class A
(NASDAQ:GOOGL)
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Rating:70Outperform
Price Target:
$394.00
▲(23.23% Upside)
Action:Reiterated
Date:07/24/26
The score is driven primarily by very strong financial performance (high profitability and a conservative balance sheet) and a reasonable earnings multiple. These positives are tempered by weak technical momentum (price below key averages with bearish MACD) and near-term cash flow/margin pressure highlighted in guidance due to elevated AI infrastructure spending.
Positive Factors
High profitability and margins
Sustained high gross and net margins across huge scale mean Alphabet converts incremental revenue into disproportionate profits. Durable margin advantages fund R&D, AI compute investments, and shareholder returns, cushioning cyclicality in advertising and supporting long-term strategic initiatives.
Negative Factors
Aggressive AI capital spending
Very large, multi-year CapEx commitments materially reduce free cash flow and increase execution risk if revenue realization lags. Heavy upfront infrastructure spending compresses near-term cash available for buybacks/dividends and heightens dependence on successful monetization of AI products.
Read all positive and negative factors
Positive Factors
Negative Factors
High profitability and margins
Sustained high gross and net margins across huge scale mean Alphabet converts incremental revenue into disproportionate profits. Durable margin advantages fund R&D, AI compute investments, and shareholder returns, cushioning cyclicality in advertising and supporting long-term strategic initiatives.
Read all positive factors
Alphabet Class A Key Performance Indicators (KPIs)
Any
Revenue by Geography
Breaks down sales by region so investors can see where Google’s core ad, cloud, and YouTube businesses are growing fastest, how reliant the company is on the U.S. market, and how currency and local regulations could impact future revenue.
Breaks down sales by region so investors can see where Google’s core ad, cloud, and YouTube businesses are growing fastest, how reliant the company is on the U.S. market, and how currency and local regulations could impact future revenue.
Data provided by:
The Fly
The FlyAlphabet Class A (GOOGL) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$4.36T
Dividend Yield0.24%
Average Volume (3M)33.23M
Price to Earnings (P/E)17.7
Beta (1Y)1.21
Revenue Growth20.23%
EPS Growth112.71%
CountryUS
Employees190,820
SectorCommunication Services
Sector Strength97
IndustryInternet Content & Information
Share Statistics
EPS (TTM)20.14
Shares Outstanding5,868,000,000
10 Day Avg. Volume32,201,431
30 Day Avg. Volume33,228,757
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
$422.32Price Target Upside32.08% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering30
EPS Forecast (FY)20.27
Revenue Forecast (FY)$495.36B
Alphabet Class A Business Overview & Revenue Model
Company Description
Alphabet Inc. provides a diverse range of products and digital platforms to consumers across multiple global regions, including North and South America, Europe, the Middle East, Africa, and the Asia-Pacific. The company's operations are organized ...
How the Company Makes Money
Alphabet generates the majority of its revenue from advertising sold across Google’s properties and network. The largest stream is Google Search and other advertising, where advertisers pay primarily for performance-based ads (commonly cost-per-cl...
Alphabet Class A 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 emphasized very strong top-line growth, exceptional Cloud momentum (82% YoY) and robust AI adoption across products, developers, and enterprise customers. Profitability improved materially (operating income +30%) and cash generation remains strong on a trailing-12-month basis. However, the company is investing aggressively in AI infrastructure, resulting in higher CapEx, supply-constrained capacity that requires third-party bridging (creating near-term margin pressure), elevated operating costs, and continued losses in Other Bets. On balance, the strategic investments are translating into accelerating product adoption and outsized Cloud growth, while creating short-term margin and cash-flow headwinds.Positive Updates
Strong Consolidated Revenue Growth
Consolidated revenues of $119.8 billion, up 24% year-over-year (23% in constant currency), delivering the 12th consecutive quarter of double-digit revenue growth.
Negative Updates
Heavy Capital Spending and Near-Term Cash Impact
Q2 CapEx of $44.9 billion (predominantly technical infrastructure) drove negative free cash flow of $5.9 billion for the quarter. Full-year 2026 CapEx guidance was increased to $195–205 billion (from $180–190 billion), indicating continued high near-term investment.
Read all updates
Q2-2026 Updates
Positive
Negative
Strong Consolidated Revenue Growth
Consolidated revenues of $119.8 billion, up 24% year-over-year (23% in constant currency), delivering the 12th consecutive quarter of double-digit revenue growth.
Read all positive updates
Company Guidance
Alphabet updated its full‑year 2026 capital plan, raising CapEx to $195–$205 billion (from $180–$190B) to accelerate capacity delivery and said CapEx will rise significantly in 2027; it expects a slight FX headwind in Q3 versus a 1‑percentage‑point FX tailwind in Q2 and will begin lapping last year’s Search acceleration. Google Cloud backlog grew by more than $50 billion sequentially to $514 billion, and the company expects to recognize just over 50% of that backlog as revenue over the next 24 months; TPU system sales began in Q2 but only a small portion of those revenues will be recognized in 2026 with the vast majority realized in 2027. To address supply constraints Alphabet will expand use of third‑party capacity in Q3 (a near‑term modest margin headwind for Cloud), continue hiring and marketing to support AI and Cloud, and noted free cash flow and margins will remain under pressure while investing (Q2 CapEx $44.9B; Q2 operating cash flow $39.1B; Q2 free cash flow ‑$5.9B; trailing‑12‑month operating cash flow $185.7B and FCF $53.3B). Balance sheet and capital return metrics cited include cash and marketable securities $242.5B (including $87.1B of marketable equity securities), long‑term debt $98.2B, and a $0.22 per‑share quarterly dividend payable in September.Alphabet Class A Financial Statement Overview
Summary
Income Statement
92
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 A Risk Analysis
Alphabet Class A disclosed 28 risk factors in its most recent earnings report. Alphabet Class A 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 A 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% | 0.77% | 17.79% | 31.42% | |
79 Outperform | $2.92T | 21.55 | 30.50% | ― | 15.77% | 88.63% | |
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% | |
70 Outperform | $4.36T | 17.68 | 50.84% | 0.26% | 20.23% | 112.71% | |
60 Neutral | $48.67B | 4.58 | -11.27% | 4.14% | 2.83% | -41.78% | |
47 Neutral | $37.33B | 758.86 | 0.13% | ― | -2.40% | -98.39% |
* Communication Services Sector Average
GOOGL
Alphabet Class A
354.30
153.45
76.40%
AMZN
Amazon
274.48
51.79
23.26%
AAPL
Apple
313.33
84.89
37.16%
BIDU
Baidu
109.71
22.35
25.58%
META
Meta Platforms
592.10
-174.69
-22.78%
MSFT
Microsoft
499.99
-17.91
-3.46%
Alphabet Class A Corporate Events
Business Operations and StrategyShareholder Meetings
Alphabet Shareholders Approve Stock Plan Expansion, Reelect Board
Positive
Jun 11, 2026
Alphabet shareholders, meeting on June 5, 2026, approved an amendment to the 2021 Stock Plan that adds 200 million Class C shares to the plan’s reserve, bolstering the company’s capacity to grant equity awards and potentially reinforci...
Private Placements and FinancingRegulatory Filings and Compliance
Alphabet Issues Mandatory Convertible Preferred Shares, Sets New Terms
Positive
Jun 5, 2026
Alphabet Inc. completed significant capital markets transactions in early June 2026, entering an underwriting agreement on June 2, 2026 to issue 167,500,000 Series A and 167,500,000 Series B depositary shares, each representing a 1/20th interest i...
Business Operations and StrategyPrivate Placements and Financing
Alphabet announces major equity raise to fund AI
Positive
Jun 4, 2026
On June 1 and 2, 2026, Alphabet moved to raise a total of about $80 billion in equity capital via concurrent underwritten offerings, a new $40 billion at-the-market program for Class A and Class C shares, and a $10 billion private placement with B...
Business Operations and StrategyPrivate Placements and Financing
Alphabet Raises ¥576.9B Through Multi-Tranche Yen Notes
Positive
May 21, 2026
On May 21, 2026, Alphabet Inc. closed an underwritten public offering of ¥576.9 billion in Japanese yen-denominated senior notes, issued under an existing indenture with The Bank of New York Mellon Trust Company, N.A. as trustee. The multi-tr...
Business Operations and StrategyPrivate Placements and Financing
Alphabet Expands Euro and Canadian Dollar Bond Funding
Positive
May 11, 2026
On May 11, 2026, Alphabet Inc. completed concurrent underwritten public offerings of €9 billion in euro-denominated senior notes and C$9.5 billion in Canadian dollar-denominated senior notes, issued under its existing shelf registration. The...
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.