Alphabet Earnings Preview: Buy GOOGL Stock While its Cheap?

AlphabetGOOGL, the parent company of Google, is one of the most innovative and dominant businesses in the world. The company has evolved from a single major business, search, into multiple major streams of revenue including Google Cloud services and YouTube.

After a decade and a half of near perfect performance, and empire building, Alphabet proved to be fallible. Over the last year GOOGLs share price is down - 22% and it was down as much as -45% during the worst of the correction.

This big sell-off leaves GOOGL at an appealing level, and the companys valuation is as compelling as it has been in the last decade. Alternatively, GOOGL faces continued regulatory scrutiny and litigation risk because of its Monopoly-like status.

Business Model

Alphabet reports total revenues under three distinct segments: Google Services, Google Cloud, and Other Bets. Services, which includes ads, Android, Chrome, hardware, Google Maps, Google Play, Search, and YouTube make up most revenues at 92.2%. Google Cloud, which includes Alphabets enterprise, infrastructure, data analytics, and collaboration tools makes up another 7.5%. While Other Bets is just 0.3% of revenue.