From Nasdaq: 2024-04-03 07:15:00

In March, the stock market saw a modest increase, with the S&P 500 rising by 2.3%. However, Alphabet’s stock performed even better, jumping by 10%. Despite the rally, there are still positive signs for Alphabet that make it a confident buy.

Alphabet started March with a lower valuation compared to its big tech peers, but it has since caught up due to its strong business performance, particularly in advertising. With revenue streams from Google search engine and YouTube performing well, Alphabet is now gaining the respect it deserves.

Alphabet’s revenue is mainly driven by advertising, with ad revenue up 11% in the fourth quarter. Additionally, its Google Cloud division is experiencing strong growth, up 26% in Q4, and is crucial for developing AI technologies.

With a strong showing in its subscription business, particularly with YouTube subscriptions, and growth divisions succeeding, Alphabet has bounced back from its previous low valuation. Despite this, the stock is still not considered expensive and remains relative to its peers.

As Alphabet prepares to release its first-quarter results in late April, investors are looking for confirmation that the company deserves its current valuation. Key focus areas include advertising revenue growth and operating margin, which will determine investor confidence in Alphabet’s future performance.

Before investing $1,000 in Alphabet, investors should consider that the company was not among the Motley Fool’s top 10 stocks. The Motley Fool Stock Advisor team has identified stocks they believe could produce higher returns in the coming years, providing investors with guidance and stock picks to build a successful portfolio.



Read more at Nasdaq: Alphabet’s Stock Was Up 10% in March. Are Investors too Late?