Are Google Stocks Cheap With Fourth Quarter Earnings Nearby?

Alphabet Stocks (Google) (NASDAQ:GOOG) is scheduled to release its fourth quarter 2021 results on Tuesday, February 1. We expect GOOG to exceed consensus estimates for revenue and earnings. The company has reported better-than-expected revenue and earnings in each of the past four quarters. In the first nine months of the year, the company’s revenue growth was driven by the YouTube Ads segment and the Google Cloud segment. Google search continued to experience steady growth. We expect the same for the results of the fourth quarter of fiscal 2021. Our forecast indicates that Google’s rating is around $3173 per share, or 25% above the current market price of $2585. Watch our interactive dashboard analysis at Google revenue overview: What to expect in the fourth trimester? for more details.

(1) Revenue expected ahead of consensus estimates

Google’s revenue for the year 2020 were $182.5 billion, up 13% year-on-year, with strong growth driven by growth in the YouTube Ads segment and Google Cloud segment. Trefis estimates GOOG’s Q4 2021 revenue to be around $69.87 billion, above the consensus estimate of $69.5 billion. We expect the YouTube Ads segment and the Google Cloud segment to continue to generate results. Our dashboard on Google’s revenue offers more details on the company’s operating segments as well as our forecast for the next two years.

(2) EPS likely to be higher than consensus estimates

GOOG’s Q4 2021 earnings per share are expected to be $29.41 per Trefis analysis, above the consensus estimate of $27.41. The company’s net profit margin increased slightly in 2020 and is expected to continue to grow in 2021. In total, the company is expected to report EPS of approximately $111.60 for fiscal 2021.

(3) Estimated stock price 25% above current market price

Passing through our Google’s ratingan estimated FY2022 EPS of approximately $121.78 and a P/E multiple of 26.1x, results in a price of $3,173, or 25% above the current market price of 2 $585.

Note: P/E multiples are based on year-end stock price and reported (or expected) adjusted earnings for the full year

While Google shares may rise, there are companies that look like a Better than Google. Find out how Google peers pricing on the metrics that matter. You will find other useful comparisons for companies in all sectors on Peer comparisons.

What if you were looking for a more balanced portfolio instead? here is a quality portfolio which has consistently beaten the market since late 2016.

Invest with Trefis Wallets that beat the market

See everything Trefis Price estimates

Leave a Comment