Alphabet Inc. (GOOG) has been one of the most-watched stocks by investors over the last several weeks, with some experts betting high on the asset. The Magnificent Seven stock has continued to prove its value, posting a five-year net income growth of more than 20% and thriving this year. The asset is one of the strongest-performing assets in the US tech industry, competing with rivals Meta. Alphabet’s revenue versus earnings has performed well over the past calendar year and is expected to continue once Q3 earnings are announced.
With its recent hot streak, there are several indicators that explain why Alphabet stock is trending. After hitting an all-time high in early July, Google stock swooned through the remainder of Q3. As investments in AI technology continue to soar, GOOGL is expected to see a slight bump upwards.
Why is GOOGL Trending Upwards?
Alphabet has emerged as one of the most lucrative blue-chip stocks to invest in. Dubbed an “underrated gem of a stock,” its robust performance has been accredited to the company’s recent growth in the sector of Google Cloud segment. The modification deployed by Google in the sectors of AI (Bard) and cloud computing capabilities has placed GOOGL in high regard to investors.
While media releases or rumors about a substantial change in a company’s business prospects usually make its stock “trending,” it’s important to analyze if that stock is trending up or down before making any transactional decisions. For the current quarter, Alphabet is expected to post earnings of $1.83 per share, indicating a change of +18.1% from the year-ago quarter. Alphabet expects a solid Q3 report to carry into a strong Q4 start, which could fuel the stock’s price.
Should You Buy Alphabet Stock Now?
Alphabet stock has turned in good and bad years recently. Shares jumped 65% in 2021 but in 2022 dropped 39%. Despite mounting competition in AI and internet search, Alphabet advanced 58% in 2023. The company is hoping to ride the current AI wave into positive earnings and developments over the coming months.
In a recent report from Truist Financial, Alphabet saw its target price increase to $220. Moreover, that came from the firm placing a buy rating on GOOGL, as the stock faces a potential increase of almost 33% from its previous close. These factors reinforce the stock’s return to form and how it looks to continue dominating throughout this year.
The next earnings report will be a crucial indicator of how deep GOOGL goes into the buy zone. Currently, Yahoo analysts have lowered the number of strong buy predictors. However, the stock remains in a buy zone, which could be a promising sign for potential investors.
