Alphabet Class A (GOOGL) AI Stock Analysis

• Market Cap: $2.25T
• Dividend Yield: 0.53%
• Average Volume (3M): 37.76M
• Price to Earnings (P/E): 20.6
• Beta (1Y): 1.07
• Revenue Growth: 13.02%
• EPS Growth: 37.73%
• Country: US
• Employees: 185,719
• Sector: Communication Services
• Sector Strength: 87
• Industry: Internet Content & Information
• EPS (TTM): N/A
• Shares Outstanding: 5,820,000,000
• 10 Day Avg. Volume: 34,627,524
• 30 Day Avg. Volume: 37,758,056
• PEG Ratio: 1.76
• Price to Book (P/B): 6.48
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 29.82
• Enterprise Value/Market Cap: 0.99
• Enterprise Value/Revenue: 1.62
• Enterprise Value/Gross Profit: 10.60
• Enterprise Value/Ebitda: 4.26
• 1Y Price Target: $206.51
• Price Target Upside: 7.93% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 39

• Rating: 85 Outperform
• Price Target: $224.00 ▲(17.07%Upside)

Alphabet's strong financial performance is the primary driver of its stock score, supported by robust revenue growth, profitability, and a solid balance sheet. Technical indicators show bullish momentum, while the valuation remains reasonable. The recent earnings call highlighted strong performance across key segments, with potential challenges noted but outweighed by strategic growth initiatives.

Positive Factors

AI Integration

AI integration is aiding monetization in search, which reduces the risk of revenue reset.

Earnings

Analyst expects strong results for Alphabet, with revenue and earnings per share anticipated above market expectations.

Negative Factors

Antitrust and Competition

The antitrust landscape is daunting, competition dynamic, and the macro treacherous.

DOJ Trial

The outcome of the Department of Justice search trial is anticipated to be a significant event, potentially affecting stock enthusiasm.

Alphabet Class A Business Overview & Revenue Model

Company Description

Alphabet Inc. is a multinational conglomerate headquartered in Mountain View, California. It was created through a corporate restructuring of Google on October 2, 2015, and became the parent company of Google and several former Google subsidiaries. Alphabet operates in various sectors, including technology, life sciences, investment capital, and research and development. Its core products and services range from its search engine and advertising services to cloud computing, consumer electronics, and various other technology initiatives.

How the Company Makes Money

Alphabet Inc. primarily generates revenue through its subsidiary Google, with the majority coming from advertising services. Google's advertising revenue is driven by ads displayed on its search engine, as well as on partner websites through the Google AdSense program. Additionally, Alphabet earns substantial income from its YouTube platform, which monetizes through advertisements and subscription services like YouTube Premium. The company also generates revenue from its Google Cloud services, which offer cloud computing solutions to businesses. Other Alphabet ventures, such as its 'Other Bets' segment, contribute to revenue through varied business models, including investments in life sciences and technology innovations, though these are less significant compared to Google's advertising and cloud services. Key partnerships and collaborations, such as those with smartphone manufacturers for Android OS, also play a role in its revenue generation.

Alphabet Class A Financial Statement Overview

Summary

Alphabet demonstrates exceptional financial performance with robust revenue growth, high profitability margins, a strong balance sheet with minimal leverage, and solid cash flow management. The company's high ROE and low debt further underline its financial health, positioning it as a stable and growing entity in the industry.

Income Statement

Alphabet's income statement shows impressive financial health with a strong gross profit margin of 58.6% and a net profit margin of 30.9% for TTM. The company’s revenue growth rate is robust at 16.9% over the past year, indicating strong market demand and operational efficiency. The EBIT margin of 32.7% and EBITDA margin of 37.3% further highlight Alphabet's profitability. This combination of growth and high margins reflects a well-managed, profitable enterprise with a strong competitive position in the industry.

Balance Sheet

Alphabet maintains a solid balance sheet with a low debt-to-equity ratio of 0.07, indicating minimal financial leverage and a strong equity position. The equity ratio of 72.6% reflects a robust capital structure primarily funded by equity. Return on Equity (ROE) is high at 32.1%, showing efficient use of shareholder funds to generate profits. Overall, Alphabet's balance sheet is strong, with ample liquidity and low financial risk.

Cash Flow

The cash flow statement reveals strong cash management practices with a free cash flow growth rate of 2.9%, indicating Alphabet's ability to generate and grow cash flows. The operating cash flow to net income ratio of 1.2 shows that the company converts a significant portion of its income to cash, enhancing its financial flexibility. Additionally, the free cash flow to net income ratio of 0.67 suggests solid cash flow generation relative to profits, supporting future growth initiatives and shareholder returns.

Breakdown	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	350.02B	307.39B	282.84B	257.64B	182.53B
Gross Profit	203.71B	174.06B	156.63B	146.70B	97.80B
EBITDA	135.39B	97.97B	85.16B	103.52B	61.91B
Net Income	100.12B	73.80B	59.97B	76.03B	40.27B
Balance Sheet
Total Assets	450.26B	402.39B	365.26B	359.27B	319.62B
Cash, Cash Equivalents and Short-Term Investments	95.66B	110.92B	113.76B	139.65B	136.69B
Total Debt	25.46B	27.12B	29.68B	28.39B	26.77B
Total Liabilities	125.17B	119.01B	109.12B	107.63B	97.07B
Stockholders Equity	325.08B	283.38B	256.14B	251.63B	222.54B
Cash Flow
Free Cash Flow	72.76B	69.50B	60.01B	67.01B	42.84B
Operating Cash Flow	125.30B	101.75B	91.50B	91.65B	65.12B
Investing Cash Flow	-45.54B	-27.06B	-20.30B	-35.52B	-32.77B
Financing Cash Flow	-79.73B	-72.09B	-69.76B	-61.36B	-24.41B

Alphabet Class A Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 191.34
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For GOOGL, the sentiment is Positive. The current price of 191.34 is above the 20-day moving average (MA) of 179.10, above the 50-day MA of 173.14, and above the 200-day MA of 173.55, indicating a bullish trend. The MACD of 4.37 indicates Negative momentum. The RSI at 73.40 is Negative, neither overbought nor oversold. The STOCH value of 95.74 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for GOOGL.

Alphabet Class A Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
GOOG	89 Outperform	$2.25T	20.74	34.79%	0.42%	13.02%	37.73%
GOOGL	85 Outperform	$2.25T	20.64	34.79%	0.53%	13.02%	37.73%
META	82 Outperform	$1.77T	27.47	39.83%	0.29%	19.37%	47.56%
PINS	80 Outperform	$25.79B	13.84	48.41%	―	17.81%	1175.52%
SPOT	76 Outperform	$139.64B	114.22	24.28%	―	16.07%	―
BIDU	76 Outperform	$30.73B	8.80	9.85%	―	-1.33%	32.92%
Sector *	59 Neutral	C$3.43B	8.13	-17.94%	5.28%	-2.63%	-19.63%

Alphabet Class A Corporate Events

Alphabet’s Settlement in Stockholder Derivative Action Approved

On July 8, 2025, the United States District Court for the Northern District of California preliminarily approved a settlement in a stockholder derivative action involving Alphabet Inc. The litigation alleged breaches of fiduciary duties by certain officers and directors, accusing them of exposing the company to antitrust investigations and enforcement actions. The settlement, which benefits Alphabet rather than individual stockholders, resolves claims related to anticompetitive business practices in the company’s search, Ad Tech, and Android operations. The defendants have denied all allegations, and the court will hold a settlement hearing on September 30, 2025, to consider the approval of the settlement terms.

The most recent analyst rating on (GOOGL) stock is a Buy with a $210.00 price target. To see the full list of analyst forecasts on Alphabet Class A stock, see the GOOGL Stock Forecast page.

Alphabet Stockholders Re-elect Directors at Annual Meeting

At Alphabet Inc.’s Annual Meeting of Stockholders on June 6, 2025, stockholders voted on fifteen proposals, including the election of directors and various stockholder proposals. The election of directors saw the re-election of key figures such as Larry Page and Sundar Pichai. However, several stockholder proposals, including those related to shareholder rights, financial performance policies, and AI-related reports, were not approved. The ratification of Ernst & Young LLP as the independent registered public accounting firm for the fiscal year ending December 31, 2025, was approved.

The most recent analyst rating on (GOOGL) stock is a Buy with a $200.00 price target. To see the full list of analyst forecasts on Alphabet Class A stock, see the GOOGL Stock Forecast page.

Alphabet Inc. Completes €6.75 Billion Bond Offering

On May 6, 2025, Alphabet Inc. successfully completed its euro-denominated bond offering, raising a total of €6.75 billion through the issuance of notes with varying maturities and interest rates. This strategic financial move is expected to enhance Alphabet’s capital structure and provide additional resources for its ongoing operations and growth initiatives.