Is Google Stock a Buy Right Now?

Is Google stock a buy at its current valuation today?! In this video, I explain whether or not I believe Google stock is a buy today. Alphabet is the parent company of Google, Google changed its name to Alphabet in 2015, because the company holds many other companies, like Nest, Fitbit, and Waymo. Watch until the end to find out whether I believe Google stock is a buy right now!

Did you know that on average there are 95 000 searches performed on google search engine every second many people use google’s search engine every single day along with their other products and services google ipo’d in 2004 and has its own great annual returns since then over the last 18 years but it’s google and its parent company alphabets still a buy at its current

Valuation today hi everyone my name is paul and welcome to my youtube channel where i talk about all things finance and investing in this video i’ll be discussing whether google and its parent company alphabets still make a good investment today alphabet previously used to be named google but they changed the name to alphabet because they hold many other companies

Like youtube and waymo so let’s jump right into it alphabet stock price currently hovers around a hundred dollars a share and has a market cap of approximately 1.3 trillion dollars this makes alphabet one of the top five largest companies in the s p 500 the s p 500 consists of the top 500 companies that are public in the united states let’s look at alphabet’s profits

And revenues over the last four years in 2018 alphabet generated 137 billion dollars in revenue and generated 31 billion dollars in operating profits from this revenue this means that alphabet head operating margins of 22 points six percent in 2018 the average operating margins of companies in the s p 500 is 12.4 percent this means that alphabet is able to generate

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Operating margins that are twice as much as the average company in the s p 500 in 2019 alphabet had revenues of 162 billion dollars and their operating income was 36 billion dollars this means that their revenue grew by 18 from 2018 to 2019 operating income also rose by 16 over the same time period alphabets operating margins decreased slightly to 22.2 percent

From 2018 to 2019. in 2020 alphabet’s revenue was 182 billion dollars and their operating income was 41 billion dollars 2020 was a unique year in the stock market because of all the impacts and volatility caused by covid-19 many companies had revenues and profits decreased significantly in 2020 but alphabet continued to grow and stay strong revenues increased by

12 and a half percent from 2019 to 2020 and operating income grew by 14 alphabet had off operating versions of 22.5 which is slightly higher than it was in 2019. alphabet saws significant growth in revenues and operating income in 2021 a company generated 257 billion dollars in revenue and 79 billion dollars in operating income in 2021. this means that alphabet’s

Revenue increased by 41 from 2020 to 2021 and their operating income increased by 93 the growth rates and revenues and operating income from 2020 to 2021 were significantly higher than the previous few years alphabet has also kept an average of 120 billion dollars in cash on their balance sheet over the last four years this is more than enough cash to cover all the

Short-term and long-term debt that alphabet has had over the last few years alphabet has seen great growth over the last four to five years and has had more than enough cash on their balance sheet to whether any storms in the economy or the stock market however there are more things to look at when considering an investment than just revenues and profits and their

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Growth rates alphabet stock recently did it 24 1 stock split this means for every one share that you previously held alphabet will give you 19 additional shares but the price of the stock will be reduced by a factor of 20. if you previously held alphabet stock at two thousand dollars a share you would now have 20 shares at 100 a share both before and after the stock

Split your total investment stays at two thousand dollars the stock split doesn’t change anything for a business besides the number of outstanding shares and the stock price many investors believe that stock splits do allow companies to perform better this is because many retail investors consider a 100 stock being significantly cheaper than a two thousand dollar

Stock even if the market cap is the exact same alphabet also buys back a significant amount of their stock making each share that an investor owns is more valuable alphabet has bought back 55 billion dollars of their own stock in the last 12 months as alphabet decreases the number of shares outstanding by buying back stock they make each shared investor owns is more

Valuable alphabet has been impacted by an overall pullback and slowdown in the economy in 2022 the company missed on its earnings expectations for q2 of 2022 the stock is down around 35 percent from its all-time highs in late 2021 of 152 dollars a share and overall pullback in the economy and alphabet stock provides a great opportunities for long-term investors to

Buy now alphabet stock has a price to earnings ratio of 18 and a half and a forward pe ratio of 16.3 alphabet also has the opportunity to continue buying back more shares in the future and possibly even start paying out an annual dividend alphabet also regularly invests in small companies in different industries so when you’re buying alphabet stock you’re actually

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Buying more than one company and into many different industries alphabet owns companies like google youtube fitbit waymo and nest alphabet is one of the largest corporate investors in 2017 they had over 103 venture investment deals i believe that alphabet stock is a great investment right now the company trades significantly cheaper than most companies in the s p

500 buying alphabet stock gives the exposure to many different industries and companies that they regularly invest in alphabet can also weather any storm in the economy with all the cash that they have on their balance sheet the company will also consider buying back more shares in the future and possibly starting to pay out an annual dividend the reasons above make

Alphabet a great investment you have to be aware though that because alphabet is already so large you won’t be able to see the crazy returns that you would in some small cab companies over a short period of time but alphabet stock can most definitely continue to outperform the s p 500 over the next five to ten years with that i hope you guys were able to learn about

My views on alphabet stock and whether i believe it’s a great investment right now if you enjoyed this video like and smash the subscribe button if there are any other companies that you want me to make it is it a buy video on comment down below if you also have any questions about alphabet style comment down below and i’ll respond as quickly as i can see you guys next time thank you

Transcribed from video
Is Google Stock a Buy Right Now? By Sandhu Investing