NASDAQ:GOOG is showing good growth, while it is not too expensive.

Last update: Jul 10, 2024

Our stock screener has spotted ALPHABET INC-CL C (NASDAQ:GOOG) as a growth stock which is not overvalued. NASDAQ:GOOG is scoring great on several growth aspects while it also shows decent health and profitability. At the same time it remains remains attractively priced. We'll dive into each aspect below.

Assessing Growth for NASDAQ:GOOG

Every stock receives a Growth Rating from ChartMill, ranging from 0 to 10. This rating assesses various growth aspects, including historical and projected EPS and revenue growth. NASDAQ:GOOG boasts a 7 out of 10:

The Earnings Per Share has grown by an impressive 45.21% over the past year.
The Earnings Per Share has been growing by 19.55% on average over the past years. This is quite good.
The Revenue has grown by 11.78% in the past year. This is quite good.
GOOG shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 17.57% yearly.
Based on estimates for the next years, GOOG will show a quite strong growth in Earnings Per Share. The EPS will grow by 19.96% on average per year.
The Revenue is expected to grow by 10.62% on average over the next years. This is quite good.

Assessing Valuation for NASDAQ:GOOG

ChartMill assigns a proprietary Valuation Rating to each stock. The score is computed by evaluating various valuation aspects, like price to earnings and free cash flow, both absolutely as relative to the market and industry. NASDAQ:GOOG was assigned a score of 5 for valuation:

Compared to the rest of the industry, the Price/Earnings ratio of GOOG indicates a somewhat cheap valuation: GOOG is cheaper than 62.69% of the companies listed in the same industry.
Compared to the rest of the industry, the Price/Forward Earnings ratio of GOOG indicates a somewhat cheap valuation: GOOG is cheaper than 64.18% of the companies listed in the same industry.
Based on the Enterprise Value to EBITDA ratio, GOOG is valued a bit cheaper than 64.18% of the companies in the same industry.
GOOG's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. GOOG is cheaper than 65.67% of the companies in the same industry.
GOOG's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
GOOG has an outstanding profitability rating, which may justify a higher PE ratio.
GOOG's earnings are expected to grow with 20.88% in the coming years. This may justify a more expensive valuation.

Exploring NASDAQ:GOOG's Health

To gauge a stock's financial health, ChartMill utilizes a Health Rating on a scale of 0 to 10. This comprehensive evaluation encompasses liquidity and solvency, both in absolute terms and in comparison to industry peers. NASDAQ:GOOG has earned a 8 out of 10:

GOOG has an Altman-Z score of 14.89. This indicates that GOOG is financially healthy and has little risk of bankruptcy at the moment.
GOOG's Altman-Z score of 14.89 is amongst the best of the industry. GOOG outperforms 95.52% of its industry peers.
GOOG has a debt to FCF ratio of 0.20. This is a very positive value and a sign of high solvency as it would only need 0.20 years to pay back of all of its debts.
The Debt to FCF ratio of GOOG (0.20) is better than 83.58% of its industry peers.
A Debt/Equity ratio of 0.05 indicates that GOOG is not too dependend on debt financing.
A Current Ratio of 2.15 indicates that GOOG has no problem at all paying its short term obligations.
GOOG has a Quick Ratio of 2.15. This indicates that GOOG is financially healthy and has no problem in meeting its short term obligations.

Evaluating Profitability: NASDAQ:GOOG

ChartMill assigns a proprietary Profitability Rating to each stock. The score is computed by evaluating various profitability ratios and margins and ranges from 0 to 10. NASDAQ:GOOG was assigned a score of 9 for profitability:

GOOG's Return On Assets of 20.23% is amongst the best of the industry. GOOG outperforms 94.03% of its industry peers.
GOOG has a Return On Equity of 28.14%. This is amongst the best in the industry. GOOG outperforms 92.54% of its industry peers.
GOOG's Return On Invested Capital of 24.32% is amongst the best of the industry. GOOG outperforms 97.01% of its industry peers.
The Average Return On Invested Capital over the past 3 years for GOOG is significantly above the industry average of 10.03%.
The 3 year average ROIC (22.54%) for GOOG is below the current ROIC(24.32%), indicating increased profibility in the last year.
GOOG has a better Profit Margin (25.90%) than 91.04% of its industry peers.
GOOG has a Operating Margin of 29.68%. This is amongst the best in the industry. GOOG outperforms 95.52% of its industry peers.
GOOG's Operating Margin has improved in the last couple of years.

Every day, new Affordable Growth stocks can be found on ChartMill in our Affordable Growth screener.

Our latest full fundamental report of GOOG contains the most current fundamental analsysis.

Disclaimer

This is not investing advice! The article highlights some of the observations at the time of writing, but you should always make your own analysis and invest based on your own insights.