Looking for growth without the hefty price tag? Consider NASDAQ:GOOGL.

Last update: Oct 3, 2024

ALPHABET INC-CL A (NASDAQ:GOOGL) has caught the eye of our stock screener as an affordable growth stock. NASDAQ:GOOGL is displaying robust growth metrics and also excels in terms of profitability, solvency, and liquidity. Additionally, it appears to be reasonably priced. Let's delve into the details.

What does the Growth looks like for NASDAQ:GOOGL

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:GOOGL boasts a 7 out of 10:

The Earnings Per Share has grown by an impressive 47.67% over the past year.
Measured over the past years, GOOGL shows a quite strong growth in Earnings Per Share. The EPS has been growing by 19.55% on average per year.
The Revenue has grown by 13.38% in the past year. This is quite good.
The Revenue has been growing by 17.57% on average over the past years. This is quite good.
GOOGL is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 19.96% yearly.
GOOGL is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 10.62% yearly.

Assessing Valuation for NASDAQ:GOOGL

An integral part of ChartMill's stock analysis is the Valuation Rating, which spans from 0 to 10. This rating evaluates diverse valuation factors, including price to earnings and cash flows, while considering the stock's profitability and growth. NASDAQ:GOOGL has received a 6 out of 10:

70.00% of the companies in the same industry are more expensive than GOOGL, based on the Price/Earnings ratio.
GOOGL's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 31.01.
Based on the Price/Forward Earnings ratio, GOOGL is valued a bit cheaper than 67.14% of the companies in the same industry.
Based on the Enterprise Value to EBITDA ratio, GOOGL is valued a bit cheaper than the industry average as 70.00% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, GOOGL is valued a bit cheaper than 64.29% of the companies in the same industry.
GOOGL's low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
The excellent profitability rating of GOOGL may justify a higher PE ratio.
A more expensive valuation may be justified as GOOGL's earnings are expected to grow with 21.32% in the coming years.

What does the Health looks like for NASDAQ:GOOGL

ChartMill assigns a proprietary Health Rating to each stock. The score is computed by evaluating various liquidity and solvency ratios and ranges from 0 to 10. NASDAQ:GOOGL was assigned a score of 9 for health:

An Altman-Z score of 13.35 indicates that GOOGL is not in any danger for bankruptcy at the moment.
GOOGL has a Altman-Z score of 13.35. This is amongst the best in the industry. GOOGL outperforms 91.43% of its industry peers.
GOOGL has a debt to FCF ratio of 0.23. This is a very positive value and a sign of high solvency as it would only need 0.23 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 0.23, GOOGL belongs to the top of the industry, outperforming 84.29% of the companies in the same industry.
A Debt/Equity ratio of 0.04 indicates that GOOGL is not too dependend on debt financing.
GOOGL has a Current Ratio of 2.08. This indicates that GOOGL is financially healthy and has no problem in meeting its short term obligations.
GOOGL has a Quick Ratio of 2.08. This indicates that GOOGL is financially healthy and has no problem in meeting its short term obligations.

Analyzing Profitability Metrics

ChartMill employs its own Profitability Rating system for stock evaluation. This score, ranging from 0 to 10, is derived from an analysis of diverse profitability metrics and margins. In the case of NASDAQ:GOOGL, the assigned 9 is noteworthy for profitability:

Looking at the Return On Assets, with a value of 21.13%, GOOGL belongs to the top of the industry, outperforming 97.14% of the companies in the same industry.
GOOGL has a Return On Equity of 29.15%. This is amongst the best in the industry. GOOGL outperforms 95.71% of its industry peers.
GOOGL has a Return On Invested Capital of 25.85%. This is amongst the best in the industry. GOOGL outperforms 98.57% of its industry peers.
GOOGL had an Average Return On Invested Capital over the past 3 years of 22.84%. This is significantly above the industry average of 10.42%.
The 3 year average ROIC (22.84%) for GOOGL is below the current ROIC(25.85%), indicating increased profibility in the last year.
With an excellent Profit Margin value of 26.70%, GOOGL belongs to the best of the industry, outperforming 95.71% of the companies in the same industry.
GOOGL's Operating Margin of 30.77% is amongst the best of the industry. GOOGL outperforms 98.57% of its industry peers.
GOOGL's Operating Margin has improved in the last couple of years.

More Affordable Growth stocks can be found in our Affordable Growth screener.

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

Disclaimer

This article should in no way be interpreted as advice. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.