Investors seeking growth at a reasonable cost should explore NASDAQ:GOOG.

ALPHABET INC-CL C (NASDAQ:GOOG) was identified as an affordable growth stock by our stock screener. NASDAQ:GOOG is showing great growth, but also scores well on profitability, solvency and liquidity. At the same time it seems to be priced reasonably. We'll explore this a bit deeper below.

Growth Assessment of NASDAQ:GOOG

To evaluate a stock's growth potential, ChartMill utilizes a Growth Rating on a scale of 0 to 10. This comprehensive assessment considers various growth aspects, including historical and estimated EPS and revenue growth. NASDAQ:GOOG has achieved a 7 out of 10:

• The Earnings Per Share has grown by an impressive 45.21% over the past year.
• The Earnings Per Share has been growing by 19.55% on average over the past years. This is quite good.
• The Revenue has grown by 11.78% in the past year. This is quite good.
• GOOG shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 17.57% yearly.
• GOOG is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 19.96% yearly.
• Based on estimates for the next years, GOOG will show a quite strong growth in Revenue. The Revenue will grow by 10.62% on average per year.

Exploring NASDAQ:GOOG's Valuation

ChartMill provides a Valuation Rating to every stock, ranging from 0 to 10. This rating assesses various valuation aspects, comparing price to earnings and cash flows, while considering factors like profitability and growth. NASDAQ:GOOG boasts a 5 out of 10:

• Based on the Price/Earnings ratio, GOOG is valued a bit cheaper than the industry average as 71.64% of the companies are valued more expensively.
• GOOG's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. GOOG is cheaper than 67.16% of the companies in the same industry.
• Based on the Enterprise Value to EBITDA ratio, GOOG is valued a bit cheaper than 68.66% of the companies in the same industry.
• Compared to the rest of the industry, the Price/Free Cash Flow ratio of GOOG indicates a somewhat cheap valuation: GOOG is cheaper than 64.18% of the companies listed in the same industry.
• The excellent profitability rating of GOOG may justify a higher PE ratio.
• A more expensive valuation may be justified as GOOG's earnings are expected to grow with 16.71% in the coming years.

Assessing Health for NASDAQ:GOOG

A critical element of ChartMill's stock evaluation is the Health Rating, which spans from 0 to 10. This rating considers multiple health factors, including liquidity and solvency, both in absolute terms and relative to industry peers. NASDAQ:GOOG has received a 8 out of 10:

• GOOG has an Altman-Z score of 13.56. This indicates that GOOG is financially healthy and has little risk of bankruptcy at the moment.
• GOOG has a better Altman-Z score (13.56) than 94.03% of its industry peers.
• The Debt to FCF ratio of GOOG is 0.20, which is an excellent value as it means it would take GOOG, only 0.20 years of fcf income to pay off all of its debts.
• The Debt to FCF ratio of GOOG (0.20) is better than 85.07% of its industry peers.
• GOOG has a Debt/Equity ratio of 0.05. This is a healthy value indicating a solid balance between debt and equity.
• A Current Ratio of 2.15 indicates that GOOG has no problem at all paying its short term obligations.
• GOOG has a Quick Ratio of 2.15. This indicates that GOOG is financially healthy and has no problem in meeting its short term obligations.

Evaluating Profitability: NASDAQ:GOOG

ChartMill assigns a proprietary Profitability Rating to each stock. The score is computed by evaluating various profitability ratios and margins and ranges from 0 to 10. NASDAQ:GOOG was assigned a score of 9 for profitability:

• With an excellent Return On Assets value of 20.23%, GOOG belongs to the best of the industry, outperforming 94.03% of the companies in the same industry.
• Looking at the Return On Equity, with a value of 28.14%, GOOG belongs to the top of the industry, outperforming 92.54% of the companies in the same industry.
• GOOG's Return On Invested Capital of 24.32% is amongst the best of the industry. GOOG outperforms 97.01% of its industry peers.
• GOOG had an Average Return On Invested Capital over the past 3 years of 22.54%. This is significantly above the industry average of 9.68%.
• The last Return On Invested Capital (24.32%) for GOOG is above the 3 year average (22.54%), which is a sign of increasing profitability.
• GOOG has a better Profit Margin (25.90%) than 91.04% of its industry peers.
• Looking at the Operating Margin, with a value of 29.68%, GOOG belongs to the top of the industry, outperforming 95.52% of the companies in the same industry.
• In the last couple of years the Operating Margin of GOOG has grown nicely.

More Affordable Growth stocks can be found in our Affordable Growth screener.

For an up to date full fundamental analysis you can check the fundamental report of GOOG

Disclaimer

This article should in no way be interpreted as advice in any way. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.