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NEW YORK (TheStreet) --Alphabet (GOOGL) - Get Alphabet Inc. Class A Report reported better-than-expected 2016 third-quarter results after the market close on Thursday. The Google parent company posted earnings of $9.06 per share, above analysts'' expected $8.63 per share. Revenue grew 20% year-over-year to $22.45 billion, beating expectations of $22.05 billion.

RBC Capital Markets lead tech analyst Mark Mahaney has an "outperform" rating and a $1,025 price target on the stock but admittedly was taken aback by yesterday's results.

"We were a little surprised, to be honest. I thought margins in the core business were going to be up year-over-year and the fact that they ticked down surprised us a little bit. So they're probably spending more on marketing for the Pixel phones and Google at Home. Whether that works or not, I don't know," Mahaney explained during CNBC's "Squawk Alley" today. 

He questions Alphabet's transition into the consumer products space, saying the company's track record has not shown success in the past.

That being said, Mahaney noted the aspect of the report that led him to maintain a long-term position on the stock.

"The core advertising business is the real reason we're still bulls on the stock. This is now 19 quarters in a row of 20% year-over-year growth. Almost for that reason alone this thing remains a long for us, it's our number two pick in the space," he explained.

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Shares of Alphabet were higher in midday trading on Friday.

(Alphabet is held in Jim Cramer's charitable trust Action Alerts PLUS. See all of his holdings with a free trialhere.)

Separately, TheStreet Ratings team rates the stock as a "buy" with a ratings score of A.

Alphabet's strengths include its compelling growth in net income, robust revenue growth, largely solid financial position with reasonable debt levels by most measures, solid stock price performance and reasonable valuation levels.

You can view the full analysis from the report here: GOOGL

TheStreet Ratings objectively rated this stock according to its "risk-adjusted" total return prospect over a 12-month investment horizon. Not based on the news in any given day, the rating may differ from Jim Cramer's view or that of this article's author.

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