Valuation
P/E TTM
29.88
P/E LYR
40.82
P/B MRQ
10.00
P/S TTM
--
AI Analysis
- Current price of $356.56 appears slightly overvalued on TTM earnings basis but fairly valued to slightly undervalued relative to near-term growth potential. Valuation multiples are premium but justified by exceptional ROE and growth acceleration.
- P/E (TTM) is 29.88x, which is high but must be viewed in context of explosive earnings growth (81% in Q1)
- Forward P/E (Dynamic) is 40.82x, suggesting market is pricing in potential normalization of extraordinary growth rate
- P/B ratio is 10.00x, which is very high but typical for asset-light, high-IP technology companies and justified by phenomenal ROE of 39.4%
- P/S ratio is 10.27x, reflecting premium valuation for Alphabet's dominant market position, pricing power, and superior profitability margins
- Using TTM Diluted EPS of $10.81 and P/E range of 28x-32x, reasonable value range is $302.68 - $345.92
- Current price of $356.56 exceeds the upper bound of TTM-derived range, suggesting slight overvaluation on TTM basis
- When factoring in growth acceleration, price can be considered fairly valued to slightly undervalued relative to near-term growth potential
- Sharp decline from ~$399 peak to current ~$356 may have priced in near-term concerns, creating more attractive entry point
- 12-month fundamental target price of $400 - $425 is reasonable, implying moderate multiple expansion or growth execution