Alphabet is the parent company of Google. Alphabet was created in 2015 when Google went through a restructuring process. Google is the undisputed leader in search. YouTube, the world’s dominant video platform, also comes under the control of Alphabet. If you are thinking content, then video as a category is among the fastest-growing. It is projected to continue the upward trajectory because more people are getting access to high-speed internet. The developing world is experiencing higher smartphone penetration and has access to cheaper data packages. So, internet content and information stocks could be a strategic bet for investors at this moment. There are plenty of content companies because internet content includes video, images, and other forms of content. Picking the right company, therefore, becomes important.
Alphabet Releases Q12021 Earnings Results
Alphabet came out with its Q12021 earnings results on 27th April 2021. Revenue increased 34% year-on-year from $41 billion in Q12020 to over $55 billion. Net earnings per share on a diluted basis also jumped significantly from $9.87 in Q12020 to $26.29 in Q12021. The operating margins showed improvement from 19% in Q12020 to 30% in Q12021. All of these metrics seem to suggest that Alphabet is going through a healthy growth phase. Company CEO Sundar Pichai said that Google plans to invest more than $7 billion in data centres and offices in the US in the year 2021. Mr Pichai also revealed several initiatives that help reduce carbon footprint and allow users to lower make sustainable choices using Google’s products. So, from an ESG point of view, Alphabet is doing things that make them a responsible company. Alphabet is among the top internet content stocks.
Alphabet’s stock has grown from around $720 in May 2016 to $2351 in May 2021. Since the market crash in March 2020, the stock is up to 2.3X. If you look at a 10-year history, then the growth in the price of the stock is also upward and consistent.