Tech giant Alphabet (NASDAQ:GOOGL) will release its first quarterly earnings after the market closes on Thursday, April 25. Wall Street remains upbeat on GOOGL ahead of the quarterly print. The ongoing strength in the Search, YouTube, and Cloud segments is likely to boost GOOGL’s quarterly numbers.
Let’s delve into the Street’s consensus estimates for Alphabet’s upcoming earnings.
GOOGL – Q1 Expectations
Analysts expect GOOGL to post revenue of $78.70 billion in the first quarter, up about 15.7% from $68.01 billion in the prior-year quarter. The expected year-on-year growth in revenue is likely to be driven by improvements in Google advertising, led by Search and YouTube. Moreover, strong growth in subscriptions is expected to support its overall revenue.
The company is also likely to benefit from accelerated growth in the Cloud business, driven by the integration of Generative AI into its products.
The increase in revenue and the company’s continued focus on reducing its cost structure will likely cushion its bottom line in Q1. Wall Street expects Alphabet to report earnings of $1.51 per share, up from $1.17 in the prior-year quarter.
Is Alphabet Stock a Buy, Sell, or Hold?
Stifel Nicolaus analyst Mark Kelley increased Alphabet stock’s price target on April 16 to $174 from $154 and maintained a Buy rating. The five-star analyst sees continued improvement in the advertising environment, which will likely support GOOGL’s financials.
It’s worth noting that Kelley is the most accurate analyst covering the stock in a one-year timeframe, according to TipRanks. Copying Kelly’s trades on GOOGL stock and holding each position for one year could result in 91% of your transactions generating a profit, with an average return of an impressive 30.34% per trade.
Overall, with 30 Buys and seven Holds, Alphabet stock has a Strong Buy consensus rating. Meanwhile, Alphabet stock is up over 49% in one year. Consequently, analysts’ average GOOGL stock price target of $167.51 implies a limited 5.84% upside potential from current levels.
Bottom Line
Tech giant GOOGL is poised to leverage its dominance in the Search, YouTube, and Cloud segments. Furthermore, enhanced operating efficiency resulting from cost reductions is expected to bolster its bottom line. Further, analysts are upbeat about the company’s future prospects ahead of its quarterly earnings.
