Should You Hold Google (GOOGL)?

[View in browser]( [The Spill Logo] BROUGHT TO YOU BY: [Logo]( Proprietary Data Insights Financial Pros’ Top Meme Value Stock Searches in the Last Month Rank Ticker Name Searches #1 [GOOGL]( Alphabet 62 #2 [META]( Meta 50 #3 [BIDU]( Baidu 11 #4 [SPOT]( Spotify 3 #5 [PINS]( Pinterest 1 #ad [Adding Color to the Investment Spectrum]( Brought to you by [Stansberry Research]( [Stock Alert: Prepare for a “cash avalanche”]( [Stansberry Research - Stock Alert: Prepare for a “cash avalanche”]( The Dow crossed 40,000 for the first time in history... The S&P has hit over 30 all-time highs since the start of the year. The words "mania," "euphoria," and "frenzy" are all over the financial press... So why are top hedge funds currently dumping their stocks? According to Goldman Sachs, hedge funds haven't gone on a selling spree like this since 2017. It's a record off-loading of stocks. What's really going on? And what does it mean for YOUR money in the coming weeks? [Click here to see the viral video viewed by over 6 million people.]( Google’s (GOOGL) Stock Selloff Means Opportunity Google parent Alphabet (GOOGL) reported some spectacular numbers amongst the deluge of earnings last week. Revenue jumped 13.6% YoY, while EPS climbed 31.7% led by strong search sales. Even the cloud business managed to see profits jump 297%, which offset losses from the company’s Other Bets. Despite all this, shares sold off with the rest of the market. This got financial pros interested in the stock, and as its price dropped, they searched it out more earnestly, according to our TrackStar data. We’re big fans of the company and see the latest pullback as a chance to scoop up shares. Google’s Business Technically, the parent company’s name is Alphabet. But we’ve been around long enough that it will always be Google to us. The company's core business revolves around internet-related services and products, including its ubiquitous search engine, cloud computing, software, and hardware. Its moonshot factory, X, also pursues ambitious projects ranging from self-driving cars to internet-beaming balloons, constantly pushing the boundaries of what's possible. In fact, the company plans to spend $5 billion on Waymo in the coming years. Google segments its business into the following areas: - Google Services (77% of total revenues) - Includes advertising, Android, Chrome, hardware, Google Maps, Google Play, Search, and YouTube - Google Cloud (12% of total revenues) - Offers cloud platform services, collaboration tools, and other enterprise solutions - Other Bets (0.5% of total revenues) - Encompasses various initiatives, including Verily (health data), Waymo (self-driving technology), and other innovative ventures Google is betting big on AI, adding conversational abilities to Google Search and empowering cloud customers with cutting-edge machine learning tools, Their homegrown large language models - PaLM and Gemini - are the secret sauce, turbocharging everything from Gmail to Google Maps. Moonshots like DeepMind's protein-folding breakthroughs and Pixel phones that can translate conversations in real-time aim to not only compete but exceed their peers. Financials [FInancials] Source: Stock Analysis While revenue growth has slowed from its +20% YoY pace, it’s regained momentum from its lows in 2022. Google’s been particularly adept at monetizing not only search but also YouTube and Cloud. Like many other Silicon Valley companies, Google went on a cost-cutting rampage, ultimately improving its margins by several percentage points and, in the case of profit and free cash flow margins, turning them around entirely. Google generates $105 billion annually while spending less than half on Capital Expenditures. This leaves plenty of cash to repurchase shares, yielding roughly 3.0% annually. Valuation [Valuation] Source: Seeking Alpha Google’s current valuation puts it in an interesting position. It’s certainly cheaper than other tech companies like Tesla or Nvidia. But it’s pretty much on par with the likes of Meta (META). Historically, it’s trading a bit below its average P/E and price-to-cash flow ratios on top of trading at 16x forward operating cash flow. Growth [Growth] Source: Seeking Alpha While Google’s business is arguably steadier than Meta’s, it isn’t expected to deliver the same growth this year. Given Meta’s lower price-to-cash flow ratio, that may be a better relative valuation. However, Google’s actual profit growth, whether you’re measuring on net income or EPS, beats Meta’s on average. Profitability [Profit] Source: Seeking Alpha Interestingly, Google’s margins aren’t as high as Meta’s, though they dominate peers like Baidu (BIDU) or Pinterest (PINS). Still, you can’t argue with Google’s excellent returns on equity, assets, and total capital. [Ex-CIA Insider Releases Trump Election Bombshell]( Former advisor to the CIA, the Pentagon and the White House Jim Rickards just dropped this Trump election bombshell. For the sake of our country… I hope he’s wrong. But Jim correctly predicted the Great Recession of 2008, Trump’s 2016 election, and the Covid Crisis. [Click here to see the details because if he’s right, you need to prepare now.]([Ad] Our Opinion 9/10 Google…Alphabet…is a fantastic company. We see it as more structurally important than Meta. However, it doesn’t offer the same value and returns as Meta, which is the tradeoff. We believe Google’s work in AI is finally starting to take shape after getting blown out by OpenAI. And with a recession likely off the table, the company’s dominant search business should continue to deliver strong cash flow in the coming year. [-facebook-share]( [-twitter-share]( [-linkedin-share]( [-email-share](mailto:?body= https%3A%2F%2Finvestingchannel.com%2F%3Fp%3D623289?utm_medium=ic-nl&utm_source=120860 ) News & Insights Just Spilled - [This German ETF is Popular With Financial Pros]( - [Unlock Financial Clarity with The Juice]( - [Why Financial Pros Are Worried About Tesla (TSLA)]( - [Should You Dump CrowdStrike (CRWD)?]( [News & Insights-facebook-share]( [News & Insights-twitter-share]( [News & Insights-linkedin-share]( [News & Insights-email-share](mailto:?body= https%3A%2F%2Finvestingchannel.com%2F%3Fp%3D623289?utm_medium=ic-nl&utm_source=120860 ) [We want to hear from you. Let us know your thoughts by clicking here]( [Ads] [InvestingChannel Logo](#) Follow us on: [Facebook Logo]( [LinkedIn Logo]( [Twitter Logo]( [Instagram Logo]( To ensure delivery of all emails, [allow us on your list](. Manage your subscriptions with our [preference center](. [Unsubscribe here.]( View our privacy policy [here](. Copyright ©2024 InvestingChannel. All rights reserved. 1325 Avenue of the Americas, Floor 27 & 28 New York, New York 10019 Disclaimer: This is not investment advice. This InvestingChannel, Inc., newsletter is for information purposes only and is based on opinion. Futures, forex, stock, and options trading are not appropriate for all investors. There is a substantial risk of loss associated with trading these markets. Losses can and will occur. No system or methodology has ever been developed that can ensure returns or eliminate losses. InvestingChannel, Inc., makes no representation or implication that using any of the methodologies or systems in this newsletter will generate returns or insure against losses. Investors should be cautious about any and all investments and are advised to conduct their own due diligence prior to making any investment decisions. [Link](