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Alphabet

Nasdaq:GOOG
Snowflake Description

Flawless balance sheet with acceptable track record.

The Snowflake is generated from 30 checks in 5 different areas, read more below.
GOOG
Nasdaq
$769B
Market Cap
  1. Home
  2. US
  3. Media
Company description

Alphabet Inc. provides online advertising services in the United States, Europe, the Middle East, Africa, the Asia-Pacific, Canada, and Latin America. The last earnings update was 59 days ago. More info.


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  • Alphabet has significant price volatility in the past 3 months.
GOOG Share Price and Events
7 Day Returns
0.9%
NasdaqGS:GOOG
-3.5%
US Interactive Media and Services
-4.1%
US Market
1 Year Returns
-7.2%
NasdaqGS:GOOG
-13.8%
US Interactive Media and Services
-14.9%
US Market
GOOG Shareholder Return
  7 Day 30 Day 90 Day 1 Year 3 Year 5 Year
Alphabet (GOOG) 0.9% -19.2% -17.6% -7.2% 35.9% 108.1%
US Interactive Media and Services -3.5% -18.1% -22.4% -13.8% 17.2% 66%
US Market -4.1% -19.1% -23.4% -14.9% 3.5% 14.5%
1 Year Return vs Industry and Market
  • GOOG outperformed the Interactive Media and Services industry which returned -13.8% over the past year.
  • GOOG outperformed the Market in United States of America which returned -14.9% over the past year.
Price Volatility
GOOG
Industry
5yr Volatility vs Market
Related Companies

GOOG Value

 Is Alphabet undervalued based on future cash flows and its price relative to the stock market?

Value is all about what a company is worth versus what price it is available for. If you went into a grocery store and all the bananas were on sale at half price, they could be considered undervalued.
INTRINSIC VALUE BASED ON FUTURE CASH FLOWS
Here we compare the current share price of Alphabet to its discounted cash flow analysis.value.

The discounted cash flow value is simply looking at what the company is worth today, based on estimates of how much money it is expected to make in the future.
Raw Data

Below are the data sources, inputs and calculation used to determine the intrinsic value for Alphabet.

NasdaqGS:GOOG Discounted Cash Flow Data Sources
Data Point Source Value
Valuation Model 2 Stage Free Cash Flow to Equity
Levered Free Cash Flow Average of 36 Analyst Estimates (S&P Global) See below
Discount Rate (Cost of Equity) See below 7.3%
Perpetual Growth Rate 10-Year US Government Bond Rate 1.7%

An important part of a discounted cash flow is the discount rate, below we explain how it has been calculated.

Calculation of Discount Rate/ Cost of Equity for NasdaqGS:GOOG
Data Point Calculation/ Source Result
Risk-Free Rate 10-Year US Govt Bond Rate 1.7%
Equity Risk Premium S&P Global 5.4%
Interactive Media and Services Unlevered Beta Simply Wall St/ S&P Global 1.03
Re-levered Beta = Unlevered beta (1 + (1- tax rate) (Debt/Equity))
= 1.03 (1 + (1- 21%) (2.08%))
1.031
Levered Beta Levered Beta limited to 0.8 to 2.0
(practical range for a stable firm)
1.03
Discount Rate/ Cost of Equity = Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium)
= 1.74% + (1.031 * 5.44%)
7.35%

Discounted Cash Flow Calculation for NasdaqGS:GOOG using 2 Stage Free Cash Flow to Equity Model

The calculations below outline how an intrinsic value for Alphabet is arrived at by discounting future cash flows to their present value using the 2 stage method. We try to start with analysts estimates of free cash flow, however if these are not available we use the most recent financial results. In the 1st stage we continue to grow the free cash flow over a 10 year period, with the growth rate trending towards the perpetual growth rate used in the 2nd stage. The 2nd stage assumes the company grows at a stable rate into perpetuity.

Note: Free cash flow to equity valuations ignore the company's cash or debt.

NasdaqGS:GOOG DCF 1st Stage: Next 10 year cash flow forecast
Levered FCF (USD, Millions) Source Present Value
Discounted (@ 7.35%)
2020 33,243.96 Analyst x16 30,968.03
2021 42,310.44 Analyst x16 36,715.48
2022 50,590.11 Analyst x9 40,894.81
2023 57,021.60 Analyst x6 42,938.10
2024 65,725.55 Analyst x4 46,103.99
2025 72,058.62 Est @ 9.64% 47,085.92
2026 77,295.08 Est @ 7.27% 47,049.80
2027 81,630.45 Est @ 5.61% 46,286.99
2028 85,261.53 Est @ 4.45% 45,036.10
2029 88,361.42 Est @ 3.64% 43,478.16
Present value of next 10 years cash flows $426,557.00
NasdaqGS:GOOG DCF 2nd Stage: Terminal Value
Calculation Result
Terminal Value = FCF2029 × (1 + g) ÷ (Discount Rate – g)
= $88,361.42 × (1 + 1.74%) ÷ (7.35% – 1.74%)
$1,602,680.79
Present Value of Terminal Value = Terminal Value ÷ (1 + r)10
= $1,602,680.79 ÷ (1 + 7.35%)10
$788,597.75
NasdaqGS:GOOG Total Equity Value
Calculation Result
Total Equity Value = Present value of next 10 years cash flows + Terminal Value
= $426,557.00 + $788,597.75
$1,215,154.75
Equity Value per Share
(USD)
= Total value / Shares Outstanding
= $1,215,154.75 / 687.29
$1768.05
NasdaqGS:GOOG Discount to Share Price
Calculation Result
Non-primary Listing Adjustment Factor 1 share in NasdaqGS:GOOG represents 1.00341x of NasdaqGS:GOOG.L
(This could be a different class, a depositary receipt, a different currency, or all of these things.)
1.00341x
Value per Share
(Listing Adjusted, USD)
= Value per Share (USD) x Listing Adjustment Factor
= $ 1,768.05 x 1.00341
$1,774.08
Value per share (USD) From above. $1,774.08
Current discount Discount to share price of $1,120.84
= -1 x ($1,120.84 - $1,774.08) / $1,774.08
36.8%

Learn more about our DCF calculations in Simply Wall St’s analysis model .

Current Discount
Amount off the current price Alphabet is available for.
Intrinsic value
37%
Share price is $1120.84 vs Future cash flow value of $1774.08
Current Discount Checks
For Alphabet to be considered undervalued it must be available for at least 20% below the current price. Less than 40% is even better.
  • Alphabet's share price is below the future cash flow value, and at a moderate discount (> 20%).
  • Alphabet's share price is below the future cash flow value, but not at a substantial discount (< 40%).
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing when they are out of season, or how much your home is worth.

The amount the stock market is willing to pay for Alphabet's earnings, growth and assets is considered below, and whether this is a fair price.
Price based on past earnings
Are Alphabet's earnings available for a low price, and how does this compare to other companies in the same industry?
Raw Data
NasdaqGS:GOOG PE (Price to Earnings) Ratio Data Sources
Data Point Source Value
Earnings Per Share * Company Filings (2019-12-31) in USD $49.59
NasdaqGS:GOOG.L Share Price ** NasdaqGS (2020-04-02) in USD $1117.03
United States of America Interactive Media and Services Industry PE Ratio Median Figure of 30 Publicly-Listed Interactive Media and Services Companies 23.32x
United States of America Market PE Ratio Median Figure of 2,944 Publicly-Listed Companies 12.5x

* Trailing twelve months (TTM) annual GAAP earnings per share excluding extraordinary items.

** Primary Listing of Alphabet.

NasdaqGS:GOOG PE (Price to Earnings) Ratio Calculation
Calculation Outcome
PE Ratio

= NasdaqGS:GOOG.L Share Price ÷ EPS (both in USD)

= 1117.03 ÷ 49.59

22.53x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Alphabet is good value based on earnings compared to the US Interactive Media and Services industry average.
  • Alphabet is overvalued based on earnings compared to the United States of America market.
Price based on expected Growth
Does Alphabet's expected growth come at a high price?
Raw Data
NasdaqGS:GOOG PEG (Price to Earnings to Growth) Ratio Data Sources
Data Point Source Value
PE Ratio See PE Ratio Section 22.53x
Net Income Annual Growth Rate See Future Growth Section.
Line of Best Fit* through Consensus Estimate Earnings of 36 Analysts
10.5%per year
United States of America Interactive Media and Services Industry PEG Ratio Median Figure of 25 Publicly-Listed Interactive Media and Services Companies 1.46x
United States of America Market PEG Ratio Median Figure of 2,008 Publicly-Listed Companies 0.91x

*Line of best fit is calculated by linear regression .

NasdaqGS:GOOG PEG (Price to Earnings to Growth) Ratio Calculation
Calculation Outcome
PEG Ratio

= PE Ratio ÷ Net Income Annual Growth Rate

= 22.53x ÷ 10.5%

2.14x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Alphabet is poor value based on expected growth next year.
Price based on value of assets
What value do investors place on Alphabet's assets?
Raw Data
NasdaqGS:GOOG PB (Price to Book) Ratio Data Sources
Data Point Source Value
Book Value per Share Company Filings (2019-12-31) in USD $292.65
NasdaqGS:GOOG.L Share Price * NasdaqGS (2020-04-02) in USD $1117.03
United States of America Interactive Media and Services Industry PB Ratio Median Figure of 60 Publicly-Listed Interactive Media and Services Companies 1.68x
United States of America Market PB Ratio Median Figure of 5,142 Publicly-Listed Companies 1.22x
NasdaqGS:GOOG PB (Price to Book) Ratio Calculation
Calculation Outcome
PB Ratio

= NasdaqGS:GOOG.L Share Price ÷ Book Value per Share (both in USD)

= 1117.03 ÷ 292.65

3.82x

* Primary Listing of Alphabet.

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Alphabet is overvalued based on assets compared to the US Interactive Media and Services industry average.
X
Value checks
We assess Alphabet's value by looking at:
  1. Is the discounted cash flow value less than 20%, or 40% of the share price? (2 checks) ( Click here or on bar chart for details of DCF calculation. )
  2. Is the PE ratio less than the market average, and/ or less than the Interactive Media and Services industry average (and greater than 0)? (2 checks)
  3. Is the PEG ratio within a reasonable range (0 to 1)? (1 check)
  4. Is the PB ratio less than the Interactive Media and Services industry average (and greater than 0)? (1 check)
  5. Alphabet has a total score of 2/6, see the detailed checks below.

    Note: We use GAAP Earnings per Share in all our calculations including PE and PEG Ratio.

    Full details on the Value part of the Simply Wall St company analysis model.

GOOG Future Performance

 How is Alphabet expected to perform in the next 1 to 3 years based on estimates from 36 analysts?

The future performance of a company is measured in the same way as past performance, by looking at estimated growth and how much profit it is expected to make.

Future estimates come from professional analysts. Just like forecasting the weather, they don’t always get it right!
Annual Growth Rate
10.5%
Expected annual growth in earnings.
Earnings growth vs Low Risk Savings
Is Alphabet expected to grow at an attractive rate?
  • Alphabet's earnings growth is expected to exceed the low risk savings rate of 1.7%.
Growth vs Market Checks
  • Alphabet's earnings growth is positive but not above the United States of America market average.
  • Alphabet's revenue growth is expected to exceed the United States of America market average.
Annual Growth Rates Comparison
Raw Data
NasdaqGS:GOOG Future Growth Rates Data Sources
Data Point Source Value (per year)
NasdaqGS:GOOG Future Earnings Growth Rate Line of Best Fit* through Consensus Estimate Earnings of 36 Analysts 10.5%
NasdaqGS:GOOG Future Revenue Growth Rate Line of Best Fit* through Consensus Estimate Revenue of 36 Analysts 12.4%
United States of America Interactive Media and Services Industry Earnings Growth Rate Market Cap Weighted Average 14%
United States of America Interactive Media and Services Industry Revenue Growth Rate Market Cap Weighted Average 13.1%
United States of America Market Earnings Growth Rate Market Cap Weighted Average 12.2%
United States of America Market Revenue Growth Rate Market Cap Weighted Average 7.1%

*Line of best fit is calculated by linear regression .

Industry and Market average data is calculated daily.

Learn more about our growth rate calculations in Simply Wall St’s analysis model.

Analysts growth expectations
Raw Data
NasdaqGS:GOOG Analysts Growth Expectations Data Sources
Data Point Source Value
Past Financials Company Filings (3 months ago) See Below
Future Estimates Average of up to 36 Analyst Estimates (S&P Global) See Below
All numbers in USD Millions and using Trailing twelve months (TTM) annual period rather than quarterly.
NasdaqGS:GOOG Future Estimates Data
Date (Data in USD Millions) Revenue Cash Flow Net Income * Avg. No. Analysts
2024-12-31 303,979 103,654 57,966 7
2023-12-31 273,763 91,957 50,821 9
2022-12-31 242,399 82,184 46,471 21
2021-12-31 211,330 72,322 39,960 36
2020-12-31 179,534 61,939 32,992 36
2020-04-03
NasdaqGS:GOOG Past Financials Data
Date (Data in USD Millions) Revenue Cash Flow Net Income *
2019-12-31 161,857 54,520 34,343
2019-09-30 155,058 53,080 32,620
2019-06-30 148,299 50,824 34,744
2019-03-31 142,012 48,329 27,992
2018-12-31 136,819 47,971 30,736
2018-09-30 129,866 45,252 18,768
2018-06-30 123,898 41,914 16,308
2018-03-31 117,251 39,185 16,637
2017-12-31 110,855 37,091 12,662
2017-09-30 104,596 36,236 21,015
2017-06-30 99,275 36,209 19,344
2017-03-31 94,765 37,926 20,697

*GAAP earnings excluding extraordinary items.

Super high growth metrics
High Growth Checks
  • Alphabet's earnings are expected to grow by 10.5% yearly, however this is not considered high growth (20% yearly).
  • Alphabet's revenue is expected to grow by 12.4% yearly, however this is not considered high growth (20% yearly).
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can be gauged below. We look back 3 years and see if they were any good at predicting what actually occurred. We also show the highest and lowest estimates looking forward to see if there is a wide range.
Raw Data
NasdaqGS:GOOG Past and Future Earnings per Share
Data Point Source Value
Past Financials Company Filings (3 months ago) See Below
Future Estimates Average of up to 36 Analyst Estimates (S&P Global) See Below

All data from Alphabet Company Filings, last reported 3 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

NasdaqGS:GOOG Future Estimates Data
Date (Data in USD Millions) EPS * EPS High Estimate EPS Low Estimate Avg. No. Analysts
2024-12-31 81.29 95.21 74.06 3.00
2023-12-31 73.34 84.09 61.34 4.00
2022-12-31 68.30 82.02 51.37 18.00
2021-12-31 58.10 68.14 42.87 40.00
2020-12-31 47.85 59.06 34.59 39.00
2020-04-03
NasdaqGS:GOOG Past Financials Data
Date (Data in USD Millions) EPS *
2019-12-31 49.59
2019-09-30 46.99
2019-06-30 50.00
2019-03-31 40.27
2018-12-31 44.22
2018-09-30 27.01
2018-06-30 23.48
2018-03-31 23.98
2017-12-31 18.27
2017-09-30 30.38
2017-06-30 28.03
2017-03-31 30.05

*GAAP earnings excluding extraordinary items.

Performance in 3 years
In the same way as past performance we look at the future estimated return (profit) compared to the available funds. We do this looking forward 3 years.
  • Alphabet is not expected to efficiently use shareholders’ funds in the future (Return on Equity less than 20%).
X
Future performance checks
We assess Alphabet's future performance by looking at:
  1. Is the annual earnings growth rate expected to beat the low risk savings rate, plus a premium to keep pace with inflation?
  2. Is the annual earnings growth rate expected to beat the average growth rate in earnings of the United States of America market? (1 check)
  3. Is the annual revenue growth rate expected to beat the average growth rate in revenue of the United States of America market? (1 check)
  4. Is the annual earnings growth rate expected to be above 20%? (1 check)
  5. Is the annual revenue growth rate expected to be above 20%? (1 check)
  6. Is the Return on Equity in 3 years expected to be over 20%? (1 check)
Some of the above checks will fail if the company is expected to be loss making in the relevant year.
Alphabet has a total score of 2/6, see the detailed checks below.

Note 1: We use GAAP Net Income Excluding Exceptional Items for our Earnings in all our calculations.

Full details on the Future part of the Simply Wall St company analysis model.

GOOG Past Performance

  How has Alphabet performed over the past 5 years?

The past performance of a company can be measured by how much growth it has experienced and how much profit it makes relative to the funds and assets it has available.
Past earnings growth
Below we compare Alphabet's growth in the last year to its industry (Interactive Media and Services).
Past Earnings growth analysis
We also check if the company has grown in the past 5 years, and whether it has maintained that growth in the year.
  • Alphabet's year on year earnings growth rate has been positive over the past 5 years.
  • Alphabet's 1-year earnings growth is less than its 5-year average (11.7% vs 17.7%)
  • Alphabet's earnings growth has exceeded the US Interactive Media and Services industry average in the past year (11.7% vs 5.5%).
Earnings and Revenue History
Alphabet's revenue and profit over the past 5 years is shown below, any years where they have experienced a loss will show up in red.
Raw Data

All data from Alphabet Company Filings, last reported 3 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

NasdaqGS:GOOG Past Revenue, Cash Flow and Net Income Data
Date (Data in USD Millions) Revenue Net Income * G+A Expenses R&D Expenses
2019-12-31 161,857.00 34,343.00 27,461.00 26,018.00
2019-09-30 155,058.00 32,620.00 28,308.00 24,830.00
2019-06-30 148,299.00 34,744.00 26,156.00 23,508.00
2019-03-31 142,012.00 27,992.00 25,445.00 22,409.00
2018-12-31 136,819.00 30,736.00 23,256.00 21,419.00
2018-09-30 129,866.00 18,768.00 21,685.00 19,691.00
2018-06-30 123,898.00 16,308.00 21,274.00 18,664.00
2018-03-31 117,251.00 16,637.00 20,327.00 17,722.00
2017-12-31 110,855.00 12,662.00 19,733.00 16,625.00
2017-09-30 104,596.00 21,015.00 18,821.00 15,941.00
2017-06-30 99,275.00 19,344.00 18,573.00 15,332.00
2017-03-31 94,765.00 20,697.00 18,015.00 14,523.00
2016-12-31 90,272.00 19,478.00 17,470.00 13,948.00
2016-09-30 85,537.00 19,068.00 16,579.00 13,836.00
2016-06-30 81,761.00 17,986.00 15,890.00 13,470.00
2016-03-31 77,988.00 17,040.00 15,381.00 12,896.00
2015-12-31 74,989.00 16,348.00 15,183.00 12,282.00
2015-09-30 71,763.00 15,133.00 14,902.00 11,585.00
2015-06-30 69,611.00 14,078.00 14,651.00 11,010.00
2015-03-31 67,839.00 13,566.00 14,466.00 10,459.00
2014-12-31 66,001.00 13,620.00 13,982.00 9,832.00
2014-09-30 63,605.00 13,794.00 13,104.00 8,952.00
2014-06-30 60,836.00 14,033.00 12,418.00 8,118.00
2014-03-31 57,988.00 13,388.00 11,754.00 7,646.00
2013-12-31 55,519.00 13,160.00 10,986.00 7,137.00
2013-09-30 54,231.00 12,372.00 10,705.00 7,051.00
2013-06-30 53,781.00 11,367.00 10,559.00 7,008.00

*GAAP earnings excluding extraordinary items.

Performance last year
We want to ensure a company is making the most of what it has available. This is done by comparing the return (profit) to a company's available funds, assets and capital.
  • Alphabet has not efficiently used shareholders’ funds last year (Return on Equity less than 20%).
  • Alphabet used its assets more efficiently than the US Interactive Media and Services industry average last year based on Return on Assets.
  • Alphabet's use of capital has not improved over the past 3 years (Return on Capital Employed).
X
Past performance checks
We assess Alphabet's performance over the past 5 years by checking for:
  1. Has earnings increased in past 5 years? (1 check)
  2. Has the earnings growth in the last year exceeded that of the Interactive Media and Services industry? (1 check)
  3. Is the recent earnings growth over the last year higher than the average annual growth over the past 5 years? (1 check)
  4. Is the Return on Equity (ROE) higher than 20%? (1 check)
  5. Is the Return on Assets (ROA) above industry average? (1 check)
  6. Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent earnings report. Some checks require at least 3 or 5 years worth of data.
Alphabet has a total score of 3/6, see the detailed checks below.

Note: We use GAAP Net Income excluding extraordinary items in all our calculations.

Full details on the Past part of the Simply Wall St company analysis model.

GOOG Health

 How is Alphabet's financial health and their level of debt?

A company's financial position is much like your own financial position, it includes everything you own (assets) and owe (liabilities).

The boxes below represent the relative size of what makes up Alphabet's finances.

The net worth of a company is the difference between its assets and liabilities.
Net Worth
  • Alphabet is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.
  • Alphabet's cash and other short term assets cover its long term commitments.
Balance sheet
This treemap shows a more detailed breakdown of Alphabet's finances. If any of them are yellow this indicates they may be out of proportion and red means they relate to one of the checks below.
Assets
Liabilities and shares
The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.
  • High level of physical assets or inventory.
  • Debt is covered by short term assets, assets are 38.5x debt.
Historical Debt
Nearly all companies have debt. Debt in itself isn’t bad, however if the debt is too high, or the company can’t afford to pay the interest on its debts this may have impacts in the future.

The graphic below shows equity (available funds) and debt, we ideally want to see the red area (debt) decreasing.

If there is any debt we look at the companies capability to repay it, and whether the level has increased over the past 5 years.
Raw Data

All data from Alphabet Company Filings, last reported 3 months ago.

NasdaqGS:GOOG Past Debt and Equity Data
Date (Data in USD Millions) Total Equity Total Debt Cash & Short Term Investments
2019-12-31 201,442.00 3,958.00 119,675.00
2019-09-30 194,969.00 3,956.00 121,177.00
2019-06-30 192,192.00 3,954.00 121,056.00
2019-03-31 183,472.00 3,952.00 113,488.00
2018-12-31 177,628.00 3,950.00 109,140.00
2018-09-30 169,840.00 3,948.00 106,416.00
2018-06-30 162,000.00 3,947.00 102,254.00
2018-03-31 160,825.00 5,273.00 102,885.00
2017-12-31 152,502.00 3,943.00 101,871.00
2017-09-30 157,100.00 3,941.00 100,143.00
2017-06-30 148,286.00 3,939.00 94,713.00
2017-03-31 144,949.00 3,937.00 92,439.00
2016-12-31 139,036.00 3,935.00 86,333.00
2016-09-30 134,103.00 3,938.00 83,056.00
2016-06-30 127,879.00 6,048.00 76,939.00
2016-03-31 123,569.00 7,156.00 73,429.30
2015-12-31 120,331.00 7,423.00 71,926.00
2015-09-30 116,241.00 8,259.00 68,416.00
2015-06-30 111,783.00 7,687.00 67,725.00
2015-03-31 108,448.00 6,650.00 64,626.00
2014-12-31 103,860.00 7,769.00 62,633.00
2014-09-30 98,815.00 8,394.00 60,058.00
2014-06-30 95,749.00 8,077.00 58,315.00
2014-03-31 91,711.00 8,144.00 57,276.00
2013-12-31 87,309.00 6,364.00 57,447.00
2013-09-30 82,989.00 6,883.00 54,739.00
2013-06-30 78,852.00 8,200.00 52,380.00
  • Alphabet's level of debt (2%) compared to net worth is satisfactory (less than 40%).
  • The level of debt compared to net worth has been reduced over the past 5 years (7.5% vs 2% today).
  • Debt is well covered by operating cash flow (1377.5%, greater than 20% of total debt).
  • Alphabet earns more interest than it pays, coverage of interest payments is not a concern.
X
Financial health checks
We assess Alphabet's financial health by checking for:
  1. Are short term assets greater than short term liabilities? (1 check)
  2. Are short term assets greater than long term liabilities? (1 check)
  3. Has the debt to equity ratio increased in the past 5 years? (1 check)
  4. Is the debt to equity ratio over 40%? (1 check)
  5. Is the debt covered by operating cash flow? (1 check)
  6. Are earnings greater than 5x the interest on debt (if company pays interest at all)? (1 check)
  7. Alphabet has a total score of 6/6, see the detailed checks below.
For companies that are loss making and have been so on average in the past we replace the last 2 checks with:
  1. Does cash and short term investments cover stable operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)
  2. Does cash and short term investments cover growing operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)


Full details on the Health part of the Simply Wall St company analysis model.

GOOG Dividends

 What is Alphabet's current dividend yield, its reliability and sustainability?

Dividends are regular cash payments to you from the company, similar to a bank paying you interest on a savings account.
Annual Dividend Income
Dividend payments
0%
Current annual income from Alphabet dividends. Estimated to be 0% next year.
If you bought $2,000 of Alphabet shares you are expected to receive $0 in your first year as a dividend.
Dividend Amount
Here we look how much dividend is being paid, if any. Is it above what you can get in a savings account? It is up there with the best dividend paying companies?
  • Unable to evaluate Alphabet's dividend yield against the bottom 25% of dividend payers as the company has not reported any payouts.
  • Unable to evaluate Alphabet's dividend against the top 25% market benchmark as the company has not reported any payouts.
Annualized Historical and Future Dividends
It is important to see if the dividend for a company is stable, and not wildly increasing/decreasing each year. This graph shows you the historical rate to count toward your assessment of the stock.

We also check to see if the dividend has increased in the past 10 years.
Raw Data
NasdaqGS:GOOG Annualized Past and Future Dividends
Data Point Source Value
Past Annualized Dividend Yield S&P Global Market Data See Below
Past Dividends per Share Company Filings/ Annualized Dividend Payments See Below
Future Dividends per Share Estimates Average of up to 36 Analyst Estimates (S&P Global) See Below
Global Interactive Media and Services Industry Average Dividend Yield Market Cap Weighted Average of 43 Stocks 0.5%
United States of America Market Average Dividend Yield Market Cap Weighted Average of 1941 Stocks 3.1%
United States of America Minimum Threshold Dividend Yield 10th Percentile 1.1%
United States of America Bottom 25% Dividend Yield 25th Percentile 2%
United States of America Top 25% Dividend Yield 75th Percentile 5.7%

Industry and Market average data is calculated daily.

Note all dividend per share amounts are annualized and not quarterly or other period.

NasdaqGS:GOOG Future Dividends Estimate Data
Date (Data in $) Dividend per Share (annual) Avg. No. Analysts
2024-12-31
2023-12-31
2022-12-31 0.00 4.00
2021-12-31 0.00 6.00
2020-12-31 0.00 6.00
2020-04-03

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Unable to perform a dividend volatility check as Alphabet has not reported any payouts.
  • Unable to verify if Alphabet's dividend has been increasing as the company has not reported any payouts.
Current Payout to shareholders
What portion of Alphabet's earnings are paid to the shareholders as a dividend.
  • Unable to calculate sustainability of dividends as Alphabet has not reported any payouts.
Future Payout to shareholders
  • No need to calculate the sustainability of Alphabet's dividends in 3 years as they are not expected to pay a notable one for United States of America.
X
Income/ dividend checks
We assess Alphabet's dividend by checking for:
  1. Firstly is the company paying a notable dividend (greater than 1.1%) - if not then the rest of the checks are ignored.
  2. Is current dividend yield above the bottom 25% of dividend payers? (1 check)
  3. Is current dividend yield above the top 25% of dividend payers? (1 check)
  4. Have they paid a dividend for 10 years, and during this period has the dividend been volatile (drop of more than 25%)? (1 check)
  5. If they have paid a dividend for 10 years has it increased in this time? (1 check)
  6. How sustainable is the dividend, can Alphabet afford to pay it from its earnings today and in 3 years (Payout ratio less than 90%)? (2 checks)
  7. Alphabet has a total score of 0/6, see the detailed checks below.


Full details on the Dividends part of the Simply Wall St company analysis model.

GOOG Management

 What is the CEO of Alphabet's salary, the management and board of directors tenure and is there insider trading?

Management is one of the most important areas of a company. We look at unreasonable CEO compensation, how long the team and board of directors have been around for and insider trading.
CEO
Sundar Pichai
COMPENSATION $1,881,066
AGE 46
TENURE AS CEO 0.3 years
CEO Bio

Mr. Sundar Pichai is Chief Executive Officer at Alphabet Inc. since December, 2019. Mr. Pichai has been the Chief Executive Officer of Google Inc., since October 02, 2015. Mr. Pichai leads the product management and innovation efforts for a suite of Google's search and consumer products, including iGoogle, Google Toolbar, Desktop Search and Gadgets, Google Pack and Gears. He has experience developing high-tech consumer and enterprise products. Mr. Pichai served as Senior Vice President of Products at Google Inc. (currently known as Alphabet Inc.) from October 2014 to October 2, 2015. He served as Senior Vice President of Android, Chrome & Apps at Google Inc. from March 2013 to October 2014. Mr. Pichai served as the Head of Android Mobile Software Division at Google Inc. since March 2013. He served as the Head of the Chrome Browser & Computer Operating System at Google Inc. He served as Senior Vice President of Chrome at Google Inc. from April 2011 to March 2013. He served as Vice President of Product Management at Google Inc. He joined Google in 2004. Prior to Google, he served various engineering and product management positions at Applied Materials and served as Management Consultant of McKinsey & Company, Inc. for a variety of software and semiconductor clients. He has been a Director of Alphabet Inc. since July 19, 2017. He served as a Director of Jive Software, Inc. from March 2011 to July 30, 2013. He served as a Member of Board of Advisors at Ruba, Inc. He was awarded an Institute Silver Medal. He was named a Siebel Scholar and a Palmer Scholar at the Wharton School. Mr. Pichai received Bachelor of Engineering degree with honors in metallurgical engineering from the Indian Institute of Technology, Kharagpur. He holds an M.S. in Engineering and Materials Science from Stanford University and an MBA from the Wharton School.

CEO Compensation
  • Sundar's compensation has increased by more than 20% in the past year whilst earnings grew less than 20%.
  • Sundar's remuneration is lower than average for companies of similar size in United States of America.
Management Team Tenure

Average tenure and age of the Alphabet management team in years:

2.3
Average Tenure
46
Average Age
  • The tenure for the Alphabet management team is about average.
Management Team

Sundar Pichai

TITLE
CEO & Director
COMPENSATION
$2M
AGE
46
TENURE
0.3 yrs

Larry Page

TITLE
Co-Founder & Director
COMPENSATION
$1
AGE
46
TENURE
22.3 yrs

Sergey Brin

TITLE
Co-Founder & Director
COMPENSATION
$1
AGE
45
TENURE
22.3 yrs

Ruth Porat

TITLE
Senior VP & CFO
COMPENSATION
$47M
AGE
61
TENURE
4.5 yrs

Eric Schmidt

TITLE
Technical Advisor
COMPENSATION
$2M
AGE
63
TENURE
2.3 yrs

Amie O'Toole

TITLE
Chief Accounting Officer & VP
AGE
43
TENURE
2 yrs

Ellen West

TITLE
Vice President of Investor Relations

Ivy Ross

TITLE
Head of Project Aura and Vice President
AGE
63

Astro Teller

TITLE
Head of Google X

Gulshan Verma

TITLE
SVP & Head of Client and Agency - Hotstar
TENURE
1.5 yrs
Board of Directors Tenure

Average tenure and age of the Alphabet board of directors in years:

10.1
Average Tenure
60.5
Average Age
  • The average tenure for the Alphabet board of directors is over 10 years, this suggests they are a seasoned and experienced board.
Board of Directors

John Hennessy

TITLE
Chairman & Lead Director
COMPENSATION
$486K
AGE
67
TENURE
2.3 yrs

Sundar Pichai

TITLE
CEO & Director
COMPENSATION
$2M
AGE
46
TENURE
2.8 yrs

Larry Page

TITLE
Co-Founder & Director
COMPENSATION
$1
AGE
46
TENURE
21.6 yrs

Sergey Brin

TITLE
Co-Founder & Director
COMPENSATION
$1
AGE
45
TENURE
21.6 yrs

John Doerr

TITLE
Independent Director
COMPENSATION
$426K
AGE
67
TENURE
20.9 yrs

Ann Mather

TITLE
Independent Director
COMPENSATION
$451K
AGE
59
TENURE
14.4 yrs

Ram Shriram

TITLE
Independent Director
COMPENSATION
$426K
AGE
62
TENURE
21.5 yrs

Alan Mulally

TITLE
Independent Director
COMPENSATION
$426K
AGE
73
TENURE
5.8 yrs

Roger Ferguson

TITLE
Independent Director
COMPENSATION
$426K
AGE
68
TENURE
3.8 yrs

Robin Washington

TITLE
Independent Director
AGE
56
TENURE
1 yrs
Who owns this company?
Recent Insider Trading
  • No 3 month open market individual insider trading information.
Recent Insider Transactions
Announced Type Name Entity Role Start End Shares Max Price ($) Value ($)
X
Management checks
We assess Alphabet's management by checking for:
  1. Is the CEO's compensation unreasonable compared to market cap? (1 check)
  2. Has the CEO's compensation increased more than 20% whilst the EPS is down more then 20%? (1 check)
  3. Is the average tenure of the management team less than 2 years? (1 check)
  4. Is the average tenure of the board of directors team less than 3 years? (1 check)
  5. Alphabet has a total score of 0/6, this is not included on the snowflake, see the detailed checks below.


Note: We use the top 6 management executives and board members in our calculations.

Note 2: Insider trading include any internal stakeholders and these transactions .

Full details on the Management part of the Simply Wall St company analysis model.

GOOG News

Simply Wall St News

Alphabet Inc (NASDAQ:GOOG) Investors Are Paying Above The Intrinsic Value

Today I will be providing a simple run through of a valuation method used to estimate the attractiveness of Alphabet Inc (NASDAQ:GOOG) as an investment opportunity by taking the expected future cash flows and discounting them to today's value. … 5-year cash flow forecast 2018 2019 2020 2021 2022 Levered FCF ($, Millions) $27,745.93 $32,781.49 $41,490.97 $48,680.40 $57,524.60 Source Analyst x15 Analyst x14 Analyst x7 Analyst x4 Analyst x4 Present Value Discounted @ 11.81% $24,815.08 $26,221.73 $29,682.64 $31,147.23 $32,918.14 Present Value of 5-year Cash Flow (PVCF)= $144,785 After calculating the present value of future cash flows in the intial 5-year period we need to calculate the Terminal Value, which accounts for all the future cash flows beyond the first stage. … Terminal Value (TV) = FCF2022 × (1 + g) ÷ (r – g) = $57,525 × (1 + 2.9%) ÷ (11.8% – 2.9%) = $668,356 Present Value of Terminal Value (PVTV) = TV / (1 + r)5 = $668,356 / ( 1 + 11.8%)5 = $382,463 The total value is the sum of cash flows for the next five years and the discounted terminal value, which results in the Total Equity Value, which in this case is $527,248.

Simply Wall St -

Why Alphabet Inc (NASDAQ:GOOG) Delivered An Inferior ROE Compared To The Industry

Since Alphabet’s return does not cover its cost, with a difference of -3.65%, this means its current use of equity is not efficient and not sustainable. … ROE can be broken down into three different ratios: net profit margin, asset turnover, and financial leverage. … This is called the Dupont Formula: Dupont Formula ROE = profit margin × asset turnover × financial leverage ROE = (annual net profit ÷ sales) × (sales ÷ assets) × (assets ÷ shareholders’ equity) ROE = annual net profit ÷ shareholders’ equity NasdaqGS:GOOG Last Perf Apr 23rd 18 The first component is profit margin, which measures how much of sales is retained after the company pays for all its expenses.

Simply Wall St -

Why You Should Look Beyond Alphabet Inc's (NASDAQ:GOOG) Growth

GOOG has high near term liquidity, with short term assets (cash and other liquid assets) amply covering upcoming one-year liabilities, as well as long-term commitments. … The current share price for GOOG is US$1,021.57. … Furthermore, comparing GOOG's current share price to its peers based on its industry and earnings level, it's overvalued by 114.29%, with a PE ratio of 56.18x vs.

Simply Wall St -

Is It Too Late To Buy Alphabet Inc (NASDAQ:GOOG)?

Alphabet Inc (NASDAQ:GOOG) saw a decent share price growth in the teens level on the NasdaqGS over the last few months. … In addition to this, it seems like Alphabet’s share price is quite stable, which could mean two things: firstly, it may take the share price a while to fall back down to an attractive buying range, and secondly, there may be less chances to buy low in the future once it reaches that value. … Alphabet’s optimistic future growth appears to have been factored into the current share price, with shares trading above its fair value.

Simply Wall St -

Alphabet Inc (NASDAQ:GOOG) Delivered A Better ROE Than The Industry, Here’s Why

Return on Equity = Net Profit ÷ Shareholders Equity ROE is measured against cost of equity in order to determine the efficiency of Alphabet’s equity capital deployed. … ROE can be split up into three useful ratios: net profit margin, asset turnover, and financial leverage. … This is called the Dupont Formula: Dupont Formula ROE = profit margin × asset turnover × financial leverage ROE = (annual net profit ÷ sales) × (sales ÷ assets) × (assets ÷ shareholders’ equity) ROE = annual net profit ÷ shareholders’ equity NasdaqGS:GOOG Last Perf Jan 22nd 18 Basically, profit margin measures how much of revenue trickles down into earnings which illustrates how efficient the business is with its cost management.

Simply Wall St -

Has Alphabet Inc (NASDAQ:GOOG) Improved Earnings Growth In Recent Times?

Below, I will run you through a simple sense check to build perspective on how Alphabet is doing by comparing its most recent earnings with its historical trend, in addition to the performance of its internet industry peers. … See our latest analysis for Alphabet Did GOOG beat its long-term earnings growth trend and its industry? … Well, let’s take a look at if it is merely due to industry tailwinds, or if Alphabet has experienced some company-specific growth.

Simply Wall St -

Does Alphabet Inc's (NASDAQ:GOOG) PE Ratio Warrant A Sell?

Formula Price-Earnings Ratio = Price per share ÷ Earnings per share P/E Calculation for GOOG Price per share = $1070.85 Earnings per share = $30.382 ∴ Price-Earnings Ratio = $1070.85 ÷ $30.382 = 35.2x The P/E ratio isn’t a metric you view in isolation and only becomes useful when you compare it against other similar companies. … For example, if you are inadvertently comparing riskier firms with GOOG, then GOOG’s P/E would naturally be higher than its peers since investors would reward its lower risk with a higher price. … If this assumption does not hold true, GOOG’s higher P/E ratio may be because firms in our peer group are being undervalued by the market.

Simply Wall St -

Alphabet Inc (GOOG): Can High Growth Still Justify Its December Share Price?

However, seeing as Alphabet is perceived as a high-growth stock, we must also account for its earnings growth, which is captured in the PEG ratio. … Alphabet's PE ratio of 34.15x and estimated 28.33% growth in earnings next year give it a higher PEG ratio of 1.81x. … This means that, when we account for Alphabet's growth, the stock can be viewed as a bit overvalued , based on its fundamentals.

Simply Wall St -

With An ROE Of 14.01%, Has Alphabet Inc's (GOOG) Management Done A Good Job?

Check out our latest analysis for Alphabet Peeling the layers of ROE – trisecting a company’s profitability Return on Equity (ROE) weighs GOOG’s profit against the level of its shareholders’ equity. … Return on Equity = Net Profit ÷ Shareholders Equity ROE is assessed against cost of equity, which is measured using the Capital Asset Pricing Model (CAPM) – but let’s not dive into the details of that today. … Since GOOG’s return covers its cost in excess of 2.13%, its use of equity capital is efficient and likely to be sustainable.

Simply Wall St -

GOOG Company Info

Description

Alphabet Inc. provides online advertising services in the United States, Europe, the Middle East, Africa, the Asia-Pacific, Canada, and Latin America. It offers performance and brand advertising services. The company operates through Google and Other Bets segments. The Google segment offers products, such as Ads, Android, Chrome, Google Cloud, Google Maps, Google Play, Hardware, Search, and YouTube, as well as technical infrastructure. It also offers digital content, cloud services, hardware devices, and other miscellaneous products and services. The Other Bets segment includes businesses, including Access, Calico, CapitalG, GV, Verily, Waymo, and X, as well as Internet and television services. Alphabet Inc. was founded in 1998 and is headquartered in Mountain View, California.

Details
Name: Alphabet Inc.
GOOG
Exchange: NasdaqGS
Founded: 1998
$769,018,314,272
687,286,090
Website: http://www.abc.xyz
Address: Alphabet Inc.
1600 Amphitheatre Parkway,
Mountain View,
California, 94043,
United States
Listings
Exchange Symbol Ticker Symbol Security Exchange Country Currency Listed on
NasdaqGS GOOG.L Class A Common Stock Nasdaq Global Select US USD 19. Aug 2004
DB ABEA Class A Common Stock Deutsche Boerse AG DE EUR 19. Aug 2004
XTRA ABEA Class A Common Stock XETRA Trading Platform DE EUR 19. Aug 2004
LSE 0RIH Class A Common Stock London Stock Exchange GB USD 19. Aug 2004
SWX GOOGL Class A Common Stock SIX Swiss Exchange CH CHF 19. Aug 2004
WBAG GOOA Class A Common Stock Wiener Boerse AG AT EUR 19. Aug 2004
SNSE GOOGL Class A Common Stock Santiago Stock Exchange CL USD 19. Aug 2004
BVC GOOGL Class A Common Stock Bolsa de Valores de Colombia CO COP 19. Aug 2004
BMV GOOGL * Class A Common Stock Bolsa Mexicana de Valores MX MXN 19. Aug 2004
ETLX GOOGL Class A Common Stock Eurotlx IT EUR 19. Aug 2004
NasdaqGS GOOG Class C Capital Stock Nasdaq Global Select US USD 27. Mar 2014
BASE GOOGL CEDEAR EACH REPR 1/29 COM STK CL 'A' Buenos Aires Stock Exchange AR ARS 15. Jan 2014
DB ABEC Class C Capital Stock Deutsche Boerse AG DE EUR 27. Mar 2014
XTRA ABEC Class C Capital Stock XETRA Trading Platform DE EUR 27. Mar 2014
LSE 0HD6 Class C Capital Stock London Stock Exchange GB USD 27. Mar 2014
BOVESPA GOGL34 25 BDRS REPR 1 NPV A Bolsa de Valores de Sao Paulo BR BRL 09. May 2016
BOVESPA GOGL35 25 BDRS REPR 1 NPV C Bolsa de Valores de Sao Paulo BR BRL 09. May 2016
BIT GOOG Class C Capital Stock Borsa Italiana IT EUR 27. Mar 2014
WBAG GOOC Class C Capital Stock Wiener Boerse AG AT EUR 27. Mar 2014
SNSE GOOG Class C Capital Stock Santiago Stock Exchange CL USD 27. Mar 2014
BMV GOOG * Class C Capital Stock Bolsa Mexicana de Valores MX MXN 27. Mar 2014
BVL GOOG Class C Capital Stock Bolsa de Valores de Lima PE USD 27. Mar 2014
Number of employees
Current staff
Staff numbers
118,899
Alphabet employees.
Industry
Interactive Media and Services
Media
Company Analysis and Financial Data Status
Area Date (UTC time)
Company Analysis updated: 2020/04/03 04:36
End of day share price update: 2020/04/02 00:00
Last estimates confirmation: 2020/04/02
Last earnings filing: 2020/02/04
Last earnings reported: 2019/12/31
Last annual earnings reported: 2019/12/31


All dates and times in UTC. All financial data provided by Standard & Poor’s Capital IQ.

Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.