Head to Head Review: Alphabet (GOOGL) versus Its Peers

Alphabet (NASDAQ: GOOGL) is one of 44 publicly-traded companies in the “Computer programming, data processing, & other computer related” industry, but how does it weigh in compared to its peers? We will compare Alphabet to similar businesses based on the strength of its earnings, risk, analyst recommendations, valuation, institutional ownership, profitability and dividends.

Insider and Institutional Ownership

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34.4% of Alphabet shares are owned by institutional investors. Comparatively, 47.1% of shares of all “Computer programming, data processing, & other computer related” companies are owned by institutional investors. 13.2% of Alphabet shares are owned by company insiders. Comparatively, 16.2% of shares of all “Computer programming, data processing, & other computer related” companies are owned by company insiders. Strong institutional ownership is an indication that endowments, hedge funds and large money managers believe a stock is poised for long-term growth.



Analyst Ratings

This is a breakdown of recent ratings and recommmendations for Alphabet and its peers, as reported by MarketBeat.

Sell Ratings Hold Ratings Buy Ratings Strong Buy Ratings Rating Score
Alphabet 1 5 37 1 2.86
Alphabet Competitors 509 1911 4644 230 2.63

Alphabet currently has a consensus target price of $1,181.59, indicating a potential upside of 9.22%. As a group, “Computer programming, data processing, & other computer related” companies have a potential upside of 4.34%. Given Alphabet’s stronger consensus rating and higher probable upside, analysts clearly believe Alphabet is more favorable than its peers.

Valuation and Earnings

This table compares Alphabet and its peers top-line revenue, earnings per share (EPS) and valuation.

Gross Revenue Net Income Price/Earnings Ratio
Alphabet $110.86 billion $12.66 billion 33.75
Alphabet Competitors $6.96 billion $963.84 million 40.77

Alphabet has higher revenue and earnings than its peers. Alphabet is trading at a lower price-to-earnings ratio than its peers, indicating that it is currently more affordable than other companies in its industry.

Volatility & Risk

Alphabet has a beta of 1.05, meaning that its share price is 5% more volatile than the S&P 500. Comparatively, Alphabet’s peers have a beta of 1.41, meaning that their average share price is 41% more volatile than the S&P 500.

Profitability

This table compares Alphabet and its peers’ net margins, return on equity and return on assets.

Net Margins Return on Equity Return on Assets
Alphabet 11.42% 14.94% 12.20%
Alphabet Competitors -414.64% -89.01% -30.78%

Summary

Alphabet beats its peers on 8 of the 13 factors compared.

Alphabet Company Profile

Alphabet Inc., through its subsidiaries, provides online advertising services in the United States and internationally. The company offers performance and brand advertising services. It operates through Google and Other Bets segments. The Google segment includes principal Internet products, such as Ads, Android, Chrome, Commerce, Google Cloud, Google Maps, Google Play, Hardware, Search, and YouTube, as well as technical infrastructure and newer efforts, including Virtual Reality. This segment also offers digital content, enterprise cloud services, and hardware products, as well as other miscellaneous products and services. The Other Bets segment includes businesses, such as Access, Calico, CapitalG, GV, Nest, Verily, Waymo, and X, as well as fiber Internet and Television services. Alphabet Inc. was founded in 1998 and is headquartered in Mountain View, California.

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