Can GOOGL Still Grow? [Google Stock Analysis]

Can the massive tech giant still grow at its massive market cap? Has YouTube been increasing their cash flow and revenue sustainable over the past few years? What about googles ethics as a company. Are their practices dangerous? I answer all that and more in this video!

Youtube ebs invest here bringing you guys a brand new video today we’ll be discussing alphabet or known in the streets as google the ticker for this company there’s actually two believe it or not is g-o-o-g-l or g-o-o-g so the only difference is the l at the end um the g o o g l or google is a class a share so that one gets voting rights so if you wanted to

Vote in a referendum that the google i mean alphabet offers um you can gog is a class c share and that one does not get voting rights so it’s up to you if you want the voting rights or not generally google does trade at a slight premium compared to its counterpart um so you can see right now we’re trading at 121.68 and i think oh goog is actually trading out a

Little bit more so you can see there’s like a dollar difference it’s not really going to like affect the world like the world’s not going to end about it but it’s up to you if you want the voting rights or not but alphabet is conglomerate holding companies so they own google youtube google vehicles deepmind wing and much more so it’s kind of like meta you know

How meta owns facebook instagram um things like that alphabet is the third largest holding in the s p 500 and one of the world’s biggest companies and it is the third largest tech revenue um in the industry but it isn’t all sunshines and rainbows for alphabet because they’re always getting sued for monopoly issues over their search engine being prioritized on

Android phones and operating systems tracking their customers without their consent and unlawful monitoring of their employees in general they don’t have the best privacy policy if you look it up they literally sell your data and there’s nothing you can do about it which is why i don’t even use google as a browser i use duckduckgo through firefox but you can see

Here looking at the stock oh this is the class c share we got to go back to the class a i think the sheet the c share came out later you can see class a ipod in 2004 is up forty three hundred percent since its ipo and overall they give um google grade of a minus this is a great company you can see there’s not really much cycles in it you can see it’s always

Generally gone up and it kind of looks like the s p 500 if you look at it a little bit um but now we’re going to go over and we’re going to evaluate the stock from the track your dividends page and we’ll go a little bit more in depth into this company so coming over to the tracker dividends page you can see they give them a score 15. it’s kind of irrelevant

Because google i’m just going to call it google from now on guys i’m not going to call it alphabet um google pays zero dollars and zero cents for the dividend they don’t even have a dividend so it’s really up to you but if you’re a hardcore dividend investor and like all your stocks need to be dividends then this is not a stock for you but i tr i believe that

Sometimes you have to sacrifice that dividend in order to get growth okay like sure like this company pays no dividend but it’s still growing google has grown its revenue we’ll see later on and they’re growing it very well and i truly think that sometimes you have to sacrifice that dividend to achieve a little bit more growth but it also just depends on your

Lifestyle and where your portfolio is at coming down here that you can see that google has a market cap of 1.9 trillion dollars and has a p e ratio of 29.9 27.9 excuse me you may be wondering what even is a p e ratio so that means price to earnings so that means that you have to pay 27.9 dollars to receive one dollar back hypothetically so that’s how much you have

To invest generally the higher the pe the more growth that they’re expecting the lower the pe less growth sometimes there are companies that are just growing phenomenally and their pe is just not really doing much sometimes now we’re going to we’re going to go over to the charts page now and we’re going to analyze the company so you can see they were they were

Going pretty well here a little bit of stagnation and then obviously this was the coveted bubble but now you can see that they have a net margin of 30 percent they have 35 profit before taxes so it’s actually really good profit margin and it looks to be really solid and looks to me that they’re growing it at least that’s what i can tell from this graph here going

Over to the capital allocation you can see it the return on equity was up and then came down and now it’s just really shot up especially during the covet bubble so that could be something that would concern me as you can see if we take out the 2021 and if we just focus everything after that it hasn’t really been growing that much so 2021 was really big year so you

Might need to do a little bit more research into why going over to their sales and earnings you can see this could actually be an explanation here is because look at that big they brought in a bunch of money and revenue that year so that could be a reason why they had so much return on equity but i’m not exactly sure you can see that they’ve been growing their

Sales very well as well as their earnings so very nice bar graphs there going over to their cash flow almost identical to their sales and earnings here growing very steadily you can see that they’re increasing that free cash which is very good to see besides in 2018 not sure what happened there going over to their sales it looks to be that they did fine so you

Might want to look into 2018 why they had a little less cash flow they might have acquired a company in 2018. they have increased their debt but their current ratio is down i wouldn’t worry too much about their debt guys because this is a double a rated bond company so they have the ability to pay back their debt really well they can take on debt really well

Shout out to my friend turtle mr income if you’re watching this i got that from you guys but they’re a double a rated company that’s exceptional there’s not very many companies that even get into a grade so i think i wouldn’t worry so much about their debt especially for a company that’s this massive so we’re going to head over to the conspiracy competitor

Analysis now and you can see google ranks down here that’s just because they don’t pay a dividend i would say google if they were to pay a dividend would probably be near the microsoft dot their dividend would be a little bit lower so it might be somewhere around here-ish but i’d say that google is one of the better companies especially comparing it to some of

These others so but like i said depends on your portfolio if you want the dividend or not now we’re going to go over to the evaluation page and you can see that they give google a value of 208 dollars so i do think that they are a little bullish on this software so we’ll go over to my sheet and we’ll grade it there but you can see that they score google five on

Their cash flow five on their equity and five on their price to book and they get threes on everywhere else so like it’s a grade of a four if you average it out so that means that they’re about a b company in terms of their ratios i’m not saying they’re a b company overall but their ratios look to be about b b plus but it is good to see that their cash flow is

Doing pretty well you can see if their metrics like we said got a 208 dollar value here and it they say it’s undervalued by 41 percent i’m going to go over to my sheet and we’ll check it out all right so we’re on my sheet here and we’re going to just put in the ticker gogl and all we need to do is you need to go to yahoo finance yahoo finance everyone loves

Yahoo finance and then all you have to do is you look up the company google and then you go to the analysis page and you scroll down and you find the growth so they they say that in the next year google is supposed to grow at 15.6 percent and in the next five years 13.6 percent so i would say that’s an average of 14 and i like to take five off that number so

Let’s just throw in a nine and then one thing that i’m also going to do is i’m going to increase to 2 um and then i’m going to increase to 0.8 why am i increasing those numbers so much to be bullish i truly think that google has a great moat so this company is going to be very hard to replicate okay there’s not going to be another google search engine that just

Takes over the world and 85 percent of the market space right google’s a two trillion dollar company so i’m giving it a little bit more bullish numbers here because it’s hard to replicate it has a good moat you know people aren’t able to replicate google they could try but they’re going to fail so you can see with those assumptions here you can see that we get

Intrinsic value 153 going back over here we take that 208 dollar number and we chuck it in here so you can see that we get a total of 180 that’s our that’s our blended average and we get a buy price of 144. so as it currently stands because google is trading at 121 dollars google is definitely a buy if you believe in google as well as your ability to grow at

That nine percent like we talked about even if google only grows at let’s say seven percent there still is room at 168 dollars and 135. i think google has great plays they have their cloud space which is growing pretty well and they also have their quantum computing space that one’s a little bit farther off in the future but if you believe in quantum computing

Google is one of the leaders in there with ibm so as it currently stands this is not financial advice i would say google is a buy but remember if you want that dividend this is not a company for you but if you’re willing to sacrifice that dividend definitely pick up some google thanks for watching guys this has been ebs invest please subscribe and like for more

Content also drop a follow for any suggestions for any future stock analysis that you guys want thanks for watching this has been ebs invest see ya peace

Transcribed from video
Can GOOGL Still Grow? [Google Stock Analysis] By EBS InvestsliveBroadcastDetails{isLiveNowfalsestartTimestamp2022-08-15T143007+0000endTimestamp2022-08-15T144251+0000}