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Alphabet (GOOGL) Moves 5.3% Higher: Will This Strength Last?

Zacks Equity Research
·2 min read

Alphabet (GOOGL) shares ended the last trading session 5.3% higher at $98.02. The jump came on an impressive volume with a higher-than-average number of shares changing hands in the session. This compares to the stock's 6% gain over the past four weeks.

Alphabet extended its rally, driven by its latest announcement regarding job cuts. Notably, the company is set to lay off 12,000 employees.

This internet search leader is expected to post quarterly earnings of $1.17 per share in its upcoming report, which represents a year-over-year change of -23.5%. Revenues are expected to be $63.22 billion, up 2.1% from the year-ago quarter.

Earnings and revenue growth expectations certainly give a good sense of the potential strength in a stock, but empirical research shows that trends in earnings estimate revisions are strongly correlated with near-term stock price movements.

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For Alphabet, the consensus EPS estimate for the quarter has been revised marginally higher over the last 30 days to the current level. And a positive trend in earnings estimate revision usually translates into price appreciation. So, make sure to keep an eye on GOOGL going forward to see if this recent jump can turn into more strength down the road.

The stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>>

Alphabet is part of the Zacks Internet - Services industry. Akamai Technologies (AKAM), another stock in the same industry, closed the last trading session 1.8% higher at $88.13. AKAM has returned 4.7% in the past month.

For Akamai Technologies , the consensus EPS estimate for the upcoming report has changed -0.4% over the past month to $1.27. This represents a change of -14.8% from what the company reported a year ago. Akamai Technologies currently has a Zacks Rank of #4 (Sell).

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Zacks Investment Research