Market watchers are counting on Alphabet Group’s quarterly earnings to save the company’s shares from its worst monthly performance in two years.
Alphabet, the parent company of Google, had a drop of over 13% in April, losing $237 billion in market value as investors fled growth stocks out of fear of higher and more rapid price increases due to growing inflation.
The stock is trading at a discount despite expectations that the internet behemoth would outperform its major rivals this year in terms of revenue growth. This includes Meta Platforms, Apple, Amazon, Netflix, and Google.
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Investors Afraid that Major IT Firms are Losing Their Growth Trend May Find Comfort in the Anticipated 18% Increase in Sales.
According to Bloomberg’s estimates, Apple and Amazon will expand by 8.3% and 14.6%, respectively. The average growth rate that brokers predict for the firms that make up the S&P 500 Index is 10.4%.
Following Tuesday’s market closing, Alphabet will publish its first-quarter earnings and release its first index. Experts predict a 24% increase in revenue and a roughly 20% rise in earnings per share for the first three months of the year.
Peter Choi, Senior Research Analyst at Vontobel Asset Management, remarked, “This has been a hard market for technology in general, and Alphabet has been drawn into that, but its growth still appears to have been stable unlike a lot of the other stocks.”
“Given its growth prospects and valuation that never really went out of hand, but now makes perfect sense, this is a brand that people should feel comfortable getting into,”
Alphabet stock is selling for less than 19 times profit forecasts, its lowest multiple since March 2020.
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According to Sinovos Trust senior portfolio manager Daniel Morgan, “the present situation is kind of challenging right now” for Alphabet.
There’s no reason they couldn’t handle it just fine. Assuming that they carry out all of the necessary steps.”