# Alphabet (NASDAQ:GOOGL)

As of Sun 8 Nov 2026 12:00 UTC (weekly snapshot). Full report: https://standard-equity.report/NASDAQ/GOOGL

Price $284.78 (USD), market cap $3.501T, Communication Services - Internet Content & Information.

## Valuation

- SE Reference Value (expected value, DCF): $425.64 (central 50% range $349.53 to $535.48), +49% against the price; range width narrow
- SE Grade: 3 of 3 (Value 3, Quality 3, Moat 3)
- Consensus Rating: Strong Buy (Strong buy 43, Buy 10, Hold 5, Sell 0, Strong sell 0)
- Consensus Price (mean): $399.11, +40% against the price

## Key metrics

Financials in USD. Peer percentile: 100 = best in the peer group.

| Metric | Now | 5Y median | 10Y median | Peers |
|---|---|---|---|---|
| Revenue | $471.1B | CAGR 17.2% | CAGR 18.3% | P93 |
| Revenue growth | 22.2% | 13.9% | 15.1% | P43 |
| Gross margin | 60.9% | 56.9% | 56.8% | P40 |
| Operating margin | 33.3% | 30.6% | 26.4% | P53 |
| Net margin | 50.0% | 28.6% | 22.3% | P83 |
| FCF yield | 0.6% | 4.0% | 3.9% | P10 |
| FCF margin | 4.2% | 21.2% | 21.4% | P10 |
| FCF / net income | 0.08x | 0.88x | 0.92x | P10 |
| ROIC | 28.7% | 40.2% | 37.7% | P43 |
| ROE | 45.0% | 32.1% | 21.3% | P79 |
| ROA | 23.5% | 21.2% | 14.8% | P55 |
| EPS | $19.06 | CAGR 29.8% | CAGR 25.6% | - |
| EPS growth | 87.2% | 34.4% | 27.3% | P63 |
| Book value per share | $53.33 | CAGR 16.0% | CAGR 14.5% | - |
| FCF per share | $1.60 | CAGR 14.0% | CAGR 17.4% | - |
| Dividend per share | $0.86 | CAGR 38.3% | CAGR 38.3% | - |
| Dividend yield | 0.3% | 0.4% | - | P11 |
| Payout ratio | 4.5% | - | - | P10 |
| Diluted shares | 12,294.0M | CAGR -2.3% | CAGR -1.2% | P43 |
| Buyback yield | -1.4% | 2.2% | 1.6% | P43 |
| Debt/equity | 0.22x | 0.11x | 0.10x | P59 |
| Enterprise value | $3.543T | CAGR 23.9% | CAGR 21.5% | P90 |
| Long-term debt | $144.6B | CAGR 19.6% | CAGR 35.7% | P93 |

## Company Note (Q3 2026)

Written by AI from the data above.

**Alphabet's third quarter was a Cloud story**. Revenue rose 24.7% to $127.6B on strong GCP growth in AI and core infrastructure, while Search slowed on FX, the retail APAC de minimis impact and media normalization. Revenue backlog climbed 160.5% over FY2025, a sign that enterprise AI demand is outrunning supply. Diluted EPS fell 25.3%, with AI talent pay and depreciation driving costs higher. The stock looks undervalued: SE fair value of $426 is 49.5% above the price.

**Management kept full-year 2026 capital spending** at $195 billion to $205 billion and again said it expects spending to increase significantly in 2027, with details due on the Q4 call. For the fourth quarter it flagged a slightly larger FX headwind, further scaling of TPU system sales and near-term Cloud margin pressure as third-party capacity ramps. Analysts pressed on Search slowing despite record query growth. Management cited FX, vertical dynamics and lower AI Mode monetization, and said agentic shopping is additive. Revenue momentum is holding, and consensus expects faster sales growth next year but slightly lower earnings.

**Analysts expect FY2026 adjusted EPS** to rise 45.8% on revenue growth of 24.0%. For FY2027 they see adjusted EPS slipping 3.7%, which fits management's warning about heavier capital spending and depreciation. The price implies revenue growth of only 13.1% a year, 10.9pp below the FY2026 consensus. That gap is the core of the opportunity: the market assumes a far slower path than analysts do. The company has beaten estimates in 7 of the last 8 quarters, although the latest quarter missed.

**Profitability has improved sharply**. ROE rose from 23.6% in FY2022 to 35.7% in FY2025, and net margin climbed from 21.2% to 32.8% over the same years. The trailing net margin of 50.0% sits well above its five-year median and ranks highest among the peers nearest in size. What holds quality back is cash conversion. Free cash flow is only 0.08x net income, so earnings are not turning into cash while the AI build-out absorbs capital.

**Trailing P/E** of 14.9x is 39% below its own ten-year median of 24.4x, though reported EPS is not comparable with the adjusted forecasts. SE fair value of $426 is 49.5% above the price, held with high confidence. The mean analyst target of $399 sits 40.1% above the price. Leverage has crept up, with debt/equity of 0.22x running 96% above its five-year median. For the price to hold, the capital spending has to convert into Cloud revenue and cash; a further rise in debt/equity would show it is not.

**The SE Score** is 3 of 3. Quality earns three stars because returns on capital of about 37% sit far above the cost of capital, the balance sheet holds net cash and interest is covered 51 times. Moat earns three stars because returns on capital have stayed above 15% in each of the last ten years, and each dollar retained has created $4.25 of market value. Value earns three stars with the price below SE fair value, which left the overall score unchanged.

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Weekly snapshot, not live data. For information only, not investment advice. Methodology: https://standard-equity.report/methodology