Will Alphabet (GOOGL) Stock Be Affected by CEO Page’s View of New Structure?
NEW YORK (TheStreet) -- Shares of Alphabet (GOOGL) - Get Report were gaining 0.13% to $748.74 in afternoon trading on Tuesday after CEO Larry Page made a rare public appearance to discuss the company's new structure.
In a Q&A session with Fortune editor Alan Murray at the Global Forum 2015 event in San Francisco, Page said the company would operate somewhat similarly to Warren Buffet's Berkshire Hathaway (BRK.A), according to Reuters.
While there are "some aspects of Berkshire to Alphabet," Page said it is too early to know exactly how the new company will function. "I want to push the envelope for what's possible for an innovative company with large resources," Page said.
When asked about China, Page noted that Google has always had operations in the country, saying that "we'd like to do more," according to Reuters. Page added that the question about Google's efforts in China have been delegated to Sundar Pichai, the CEO of Google, which is part of Alphabet and controls the search engine, Android, AdWords, and AdSense.
Page also touted Alphabet's Project Loon, which aims to deliver Internet service to users in remote or rural areas using connected balloons, during the talk. The project will begin testing its service in Indonesia as soon as next year, according to Reuters.
"Think about how cell phones have changed everyone's life," Page said. "Think about how having your cell phone work anywhere in the world can change your life."
TheStreet Ratings team rates ALPHABET INC as a Buy with a ratings score of B+. TheStreet Ratings Team has this to say about their recommendation:
We rate ALPHABET INC (GOOGL) a BUY. This is driven by some important positives, which we believe should have a greater impact than any weaknesses, and should give investors a better performance opportunity than most stocks we cover. The company's strengths can be seen in multiple areas, such as its compelling growth in net income, revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance and reasonable valuation levels. Although no company is perfect, currently we do not see any significant weaknesses which are likely to detract from the generally positive outlook.
Highlights from the analysis by TheStreet Ratings Team goes as follows:
- The net income growth from the same quarter one year ago has greatly exceeded that of the S&P 500, but is less than that of the Internet Software & Services industry average. The net income increased by 45.3% when compared to the same quarter one year prior, rising from $2,739.00 million to $3,979.00 million.
- Despite its growing revenue, the company underperformed as compared with the industry average of 13.7%. Since the same quarter one year prior, revenues rose by 13.0%. Growth in the company's revenue appears to have helped boost the earnings per share.
- Although GOOGL's debt-to-equity ratio of 0.05 is very low, it is currently higher than that of the industry average. Along with this, the company maintains a quick ratio of 4.51, which clearly demonstrates the ability to cover short-term cash needs.
- Powered by its strong earnings growth of 34.82% and other important driving factors, this stock has surged by 33.37% over the past year, outperforming the rise in the S&P 500 Index during the same period. Regarding the stock's future course, although almost any stock can fall in a broad market decline, GOOGL should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
- You can view the full analysis from the report here: GOOGL