Google stock rose 4% in after-hours trading as parent company Alphabet Inc (GOOG) beat earnings expectations for Q1 2020, by a huge margin.
The data, reported after the close, sent Google stock to fresh all-time-highs above $2400 per share for the first time.
Breaking down the numbers, it’s easy to see why:
Earnings per share $26.29 vs. expectations of$15.64
Revenue $55.31 Billion vs. expectations of$51.6 Billion
If smashing earnings wasn’t enough to excite the street. Investors were also buoyed by the news that Alphabet Inc plans to repurchase $50 Billion of Google stock.
CFO Ruth Porat said: ‘The repurchases are expected to be executed from time to time, subject to general business and market conditions and other investment opportunities.”
Coming into the earnings release, there had been some concern that future advertising revenue would be hit, as Google, like Apple (AAPL), plans to remove Ad-Tracking cookies from its platform. The market appears to be looking past that now and Google stock seems set to continue its march even higher.
So far in 2021, Google stock has been a stand-out performer. Since the start of the year the price has gained 30%, and 127% since the March 2020 pandemic lows. On the back of these current earnings, we may have some way to go before the price tops out.
What next for Google stock?
Basis the after-hours price of $2,408. The stock is set to open today’s trading session outside of it’s recent ascending channel.
This move outside of the channel could instigate a further extension higher for Google stock in the short term. I favor the upside from here and would be looking to add length on any pullback towards the top line of the ascending channel, with a view to reassessing on a break below $2,344.