Alphabet (Google) (GOOG) - P/E ratio (2024)

FAQs

What is the PE ratio of Google alphabet? ›

P/E ratio as of May 2024 (TTM): 33.4

According to Alphabet (Google)'s latest financial reports and stock price the company's current price-to-earnings ratio (TTM) is 33.4152. At the end of 2022 the company had a P/E ratio of 19.3.

During the past 13 years, the highest PE Ratio (TTM) of Alphabet(Google) was 66.05. The lowest was 17.20. And the median was 28.95.

Price and voting rights are the only differences between GOOG and GOOGL shares of Google. Normally shares that have voting rights are more valuable than shares without voting rights. However in the case of Google stock the non-voting shares currently cost more per share.

Typically, the average P/E ratio is around 20 to 25. Anything below that would be considered a good price-to-earnings ratio, whereas anything above that would be a worse P/E ratio.

The intrinsic value of one GOOG stock under the Base Case scenario is 135.82 USD. Compared to the current market price of 176.33 USD, Alphabet Inc is Overvalued by 23%.

With those two breadcrumbs, we see that Buffett has historically paid PE ratios of somewhere 11-15 times, which translates Ricky into earnings yields, earnings yields are just the inverse of the PE ratio of roughly 7-9 percent. These are low below market average valuations, that's the big takeaway so far, Ricky.

Why is Amazon PE Ratio so high? Amazon's P/E ratio is higher than most companies in the retail industry because investors are optimistic about its future growth potential. As mentioned, a high price multiple can indicate the market expects higher growth from a company.

P/E 30 Ratio Explained

A P/E of 30 is high by historical stock market standards. This type of valuation is usually placed on only the fastest-growing companies by investors in the company's early stages of growth.

The price-to-earnings ratio (P/E ratio) is a quick way to gauge whether a stock is undervalued or overvalued. All else equal, the lower the P/E ratio, the better the investment. For this reason, a P/E of less than 20x is “good” and anything higher than 30x is “bad.”

The decision on which to buy depends on the investor's goals. If having a say in company decisions is important, GOOGL might be the preferred choice. However, if voting rights are not a concern and one is looking for potentially lower-priced shares, GOOG could be more appealing.

Should I invest in the alphabet A or C? ›

In summary, both GOOGL and GOOG give you equal ownership in Alphabet and have performed similarly in terms of their price history. However, GOOGL does confer voting rights while GOOG doesn't and hence the former tends to trade at a slightly higher price.

Founders Larry Page and Sergey Brin, along with CEO Eric Schmidt, held enough shares to retain control. In 2014, the company reorganized into Alphabet with three stock classes: A, B and C. A and C are similar except A has voting rights and C has none. Financially, they're the same and they run about the same price.

As far as Nifty is concerned, it has traded in a PE range of 10 to 30 historically. Average PE of Nifty in the last 20 years was around 20.* So PEs below 20 may provide good investment opportunities; lower the PE below 20, more attractive the investment potential.

In general, a high P/E suggests that investors expect higher earnings growth than those with a lower P/E. A low P/E can indicate that a company is undervalued or that a firm is doing exceptionally well relative to its past performance.

For instance, if the relative P/E ratio of a counter is 80%, when compared to the benchmark P/E levels, it means that the company's absolute ratio is lower than the industry. Likewise, Relative P/E ratio higher than 100% implies that a business has outperformed the benchmark or the industry in the given time frame.

Alphabet(Google)'s Forward PE Ratio for today is 23.31. Alphabet(Google)'s PE Ratio without NRI for today is 26.69.

Min: 15.93 Med: 120.04 Max: 535.74

During the past 13 years, the highest PE Ratio (TTM) of Netflix was 535.74. The lowest was 15.93. And the median was 120.04.

The estimated P/E Ratio for S&P 500 Information Technology Sector is 33.24, calculated on 20 May 2024. P/E Ratio is calculated on the XLK Etf, whose benchmark is the S&P 500 Information Technology Sector.