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Google Stock Price Doesn't Make Any Sense

May 04, 2022 7:45 AM ETAlphabet Inc. (GOOG) Stock, GOOGL Stock313 Comments


  • Many tech stocks rightfully sold off in recent months, e.g. due to being way too expensive, or due to pandemic tailwinds ending.
  • But neither holds true for Alphabet. The company is quite inexpensive and continues to deliver strong results, even versus tough pandemic comparables.
  • GOOG stock looks like an attractive value at current prices, especially when we consider its net cash position and hidden value items such as Waymo.
  • Looking for a helping hand in the market? Members of Cash Flow Kingdom get exclusive ideas and guidance to navigate any climate. Learn More »

Kitchener-Waterloo, On, Kanada - 17. Oktober 2020: Google Bürogebäude in Kitchener-Waterloo, Ontario

JHVEPhoto/iStock Editorial via Getty Images

Article Thesis

Alphabet (NASDAQ:GOOG)(NASDAQ:GOOGL) is a high-quality company that has seen its shares decline quite a lot in recent months -- despite strong results and an undemanding valuation. I do believe that Alphabet is

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This article was written by

Jonathan Weber profile picture

Jonathan Weber holds an engineering degree and has been active in the stock market and as a freelance analyst for many years. He has been sharing his research on Seeking Alpha since 2014. Jonathan’s primary focus is on value and income stocks but he covers growth occasionally.

He is a contributing author for the investing group Cash Flow Club where along with Darren McCammon, they focus on company cash flows and their access to capital. Core features include: access to the leader’s personal income portfolio targeting 6%+ yield, community chat, the “Best Opportunities” List, coverage of energy midstream, commercial mREITs, BDCs, and shipping sectors,, and transparency on performance. Learn More.

Analyst’s Disclosure: I/we have a beneficial long position in the shares of GOOG, AMZN either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.

Seeking Alpha's Disclosure: Past performance is no guarantee of future results. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. Any views or opinions expressed above may not reflect those of Seeking Alpha as a whole. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank. Our analysts are third party authors that include both professional investors and individual investors who may not be licensed or certified by any institute or regulatory body.

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Comments (313)

good article.. I bot GOOG as the GOOG/SPY pair seems to have tested 3yr uptrend and held..on absolute basis close above 2370.76 confirms
Google is not meeting expectations with their Youtube growth of revenue, and also is unsuccessful in almost all new things it tries to do, wasting money left and right.
Plus, their search business does not have as a great of a moat as commonly assumed.
Google does not build anything needed for survival and depends upon main steeet for income! Nuff said
Damend profile picture
@Plymouthmn I wouldnt survive everyday living without Google
@Plymouthmn not sure if you are saying this is good or bad? Good because inflation doesn’t impact them much in this environment, bad becuase maybe you think a company has to make a product for survival to be a good company.
@Damend you do not need to. that is my point. their current product meets your need.
DanTheMan1984 profile picture
This stock is worth 3,000 plus plain and simple
Why Google Poses a Serious Threat to Democracy, and How to End That Threat. Testimony by Robert Epstein, Ph.D. (re@aibrt.org)
Senior Research Psychologist, American Institute for Behavioral Research and
Technology Before the United States Senate Judiciary Subcommittee on the Constitution. Tuesday, June 16, 2019, 2:30 p.m.

"In 2016, biased search results generated by Google’s search algorithm likely
impacted undecided voters in a way that gave at least 2.6 million votes to Hillary
Clinton (whom I supported).

"In the weeks leading up to the 2018 election, bias in Google’s search results may have shifted upwards of 78.2 million votes to the candidates of one political party (spread across hundreds of local and regional races). This number is based on data captured by my 2018 monitoring system, which preserved more than 47,000 election-related searches on Google, Bing, and Yahoo, along with the nearly 400,000 web pages to which the search results linked. Strong political bias toward one party was evident, once again, in Google searches (Epstein & Williams, 2019).

My recent research demonstrates that Google’s “autocomplete” search suggestions can turn a 50/50 split among undecided voters into a 90/10 split without people's awareness (http://bit.ly/2EcYnYI) (Epstein, Mohr, & Martinez, 2018). A growing body of evidence suggests that Google is manipulating people’s thinking and behavior from the very first character people type into the search box.

Google has likely been determining the outcomes of upwards of 25 percent of the national elections worldwide since at least 2015. This is because many races are very close and because Google’s persuasive technologies are very powerful (Epstein & Robertson, 2015a)."


After the 2020 election, Dr. Epstein said: ""If the targeted messaging and the search results bias were both being used for several months before the election, that would have shifted at least 6 million votes in one direction," he said without going into detail about the tools he used to make his determination. Epstein recruited agents during the 2016 campaign to code Google search results in multiple states as pro-Trump or pro-Democrat."
MaritimeTrader profile picture
@Uncommon Wisdom wow, better tightening my tinfoil hat right now!

In my personal opinion, These authors act as if they live in some sort of vacuum smh…google is losing value because google has lost the TRUST of people.. they have questionable business practices all over the world.. they get sued left and right.. they suppress information with algorithms.. they spy… they help Chinese military with certain capabilities while not helping the USA military..

They are clearly politically biased.. searchers are leaving google.. heck I stopped using google Years ago..

They are a dirty company and people caught on..

Google, Netflix, Disney.. these guys are losing big.. you can’t fix this issue with some investor fluff articles… we don’t want them in our lives anymore…

Get it through your money grubbing heads already…smh
@presmc nothing in their earnings points to what you laid out. If GOOG wasn’t trusted, how is it that their cloud datacenter usage is growing like crazy? Businesses and home consumers are leveraging the GOOG cloud to scale, process, and store info. This massive growth doesn’t happen without Trust.

GOOG has their issues, and bias is one of them. It’s known, but at the end of the day no one cares. They still use android, Google search, gmail.com, Chrome, etc. Usage is growing not contracting.

Set your politics aside and invest in a money make winner.
@Tippsology people using things because they have to isn’t the same as using it because they want to… there is an awakening taking place and alternative platforms are forming.. google is next on the menu..
they are nefarious and it has become clear to people and even governments..

The alternatives to google are already growing exponentially.. and there is nothing they can do about it..

Twitter, Disney, google, Netflix..

Days are numbered..
@presmc please explain how and why people “have to” use GOOG? Business have many alternatives to the Google Cloud data centers. There are plenty of other email platforms, web browsers, and search engines.

What other up and coming platforms for you feel are disrupters to GOOG?

We haven’t even touched advertising dollars.

I get the sense that you don’t understand GOOG as a business.

I can’t stand the political approach the take and algo manipulation, but it’s there company. Again, if people and businesses where that upset they would go elsewhere. The facts are users continue to move toward GOOG not away from GOOG.

Set your bias aside and start looking at them like a true investor.
ErikInvest profile picture
With that bad Q1 result, i dont put one dollar on Google.
There are better stock drops a lot more than google and with great Q1 result.
@ErikInvest bad Q1 result lol
Agree with this and added more this week.
100% accurate. When prices start to look ludacris, then it’s time to start nibbling. Google is one of those stocks. Amazon is another, Qualcomm is another - they are starting to look silly.
@Tdog88 you read my mind. I started QCOM today but Im having trouble high cost averaging my GOOG investment. However, Im looking at the numbers and its screaming buy. I NEED TO DO IT ALREADY!
@underscorereality GOOG will come back with vengeance. Great call with QCOM. I will be adding to both GOOG and QCOM by month's end.
RickcarinoNYC profile picture
There are plenty of articles floating recently after huge drop in stock price.
Google float is twice the size of outstanding shares.
Difference is attributed to closely held or restricted stocks. One must understand that huge cash flow and huge buy backs are mostly used for repurchasing unlock of restricted stocks and doesn’t benefit investors and that’s why these big brands don’t give any dividends. All cash flows are used to buy employees and executives compensations that are mostly given as stocks. Huge scandal.
@RickcarinoNYC can you show proof from apple, Google, meta that shows that their buybacks “doesn’t benefit investors.”
MR. TRANQUILITTI profile picture
@RickcarinoNYC Not really.

I would say look more into the advantages of stock buybacks as Warren Buffett would disagree with you as many others.

Berkshire Hathaway buys back stock enormously.
MR. TRANQUILITTI profile picture
@Tdog88 The Apple buybacks is one of the reasons Buffett loves Apple.
You can back up the truck and buy in the $1,750 - $1,800 range in 6 -9 months.
@leaddog99 imagine if you could predict the stock market, wouldn’t that be cool. You’d be rich by now and not on SA throwing out random prices.
Is 2,360 a buy?
@leaddog99 ok thx.
Everyone's scared of inflation, so they're selling off their stocks, they're selling off their gold, their copper, their foreign currencies, their bonds, and putting their money into the US dollar, because that's how they figure they'll be safe from inflation. Isn't that a great plan?
@unknowntroubles Businesses with pricing power! That's all
@unknowntroubles Theres no where to hide from inflation. It is the most nefarious form of taxation. Imagine being retired living on a fixed income…
When is the stock split?
shudacuda profile picture
I think Google's value is depressed simply due to the unknowns related to its near monopoly and the regulatory risks associated with that. i.e. Is it headed for a brick wall? Current mundane metrics of sales, P/E's, cash, debt, growth or even interest rates don't reflect any of this. That said - I am keen on owning this stock.
@shudacuda or maybe it’s depressed becuase the whole market is selling off no matter how good earnings are due to tighter monetary policy and panic selling.
DarienL profile picture
Assume most on the comment section here have NO clue what removing Fed magic of QE and 0% rates does to stonks. 120 BILLION a month flowing into stonks ending and rates rocketing up is going to swing the pendulum bigly into overshooting to the downside
@DarienL do you have historical examples to compare? We have survived without QE and having much higher interest rate before. Not only that the market did pretty well. We have even seen plenty of cases where the market thrived during recessions. There is an odd combination we are seeing today that makes it extreme difficult have confidence one way or the other. Here’s the good news, the stock market will go up over time.
Stephen Spicer profile picture
@Tippsology There are no historical examples. "We've survived without QE" - Yes, but we've only tried QT (tightening) once before: at the end of 2018. And that didn't end well. The Fed never hit its target. Now we're trying QT with WAY more on the Fed's balance sheet AND we're raising rates (at a slower pace than we probably should considering how high inflation is but faster than we have in 22 years).

And the times we had much higher interest rates, our national debt was WAY lower. Also, that has been a really long time. The Fed Funds rate has been sub-6% for more than 20 years and sub-3% for almost 15.

We've never been in this scenario before (as is pretty much always the case with economics), so you can't really make any guarantees as to what the future holds.
DarienL profile picture
@Tippsology 2018 is the best recent example
GameBuzz profile picture
I agree, despite my charts (and my P&L in GOOGL) screaming otherwise. In normal markets we would also be seeing a run up into the stock split (as with AAPL and TSLA), but this market is anything but normal as we both know!
DarienL profile picture
@GameBuzz You mean this is now a normal market without Fed magic money
Exactly. Everyone has a warped mind about what’s really normal after the last decade. Some of the valuations over the last couple years have been crazy, too much for my conservative self. But if this sell off continues and I can snatch up some google shares with a mid teens multiple I’m a buyer.
DarienL profile picture
@Mountain Walker 100% agree. In the teens, GOOG is a screaming buy
When program trading algorithms are in play, it does not have to make sense. We just have to wait till their 'sell all' invasion is done. Then go in and pick up some scraps.
@PrettyInGreen can you let us know when they are done?
@PrettyInGreen I agree that right now it’s all algorithms trading. The moves the last few trading sessions aren’t rational at all. After the fed announces rate hikes market goes up 3% in 1 hour . Just to crash 5% the next day. It’s clearly robo trading by big money
657 profile picture
Nice summary. I like
GOOGL but the macro-environment is tough thus getting traction for a,stock such as GOOGL is tough. I have bought recently but not at the point of satisfaction and 1 share here and 5 shares there makes accumulation very slow indeed. I like the stock but with increasing interest rates, just thought time for investors.
Damend profile picture
Warren Buffets next move
Jonathan Weber profile picture
@Damend I think it's more attractive than AAPL. All the best
@Jonathan Weber Its not even close. If Buffet bought google tomorrow everyone would be slapping themselves for how obvious a play it was.
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