22 October 2025, Bavaria, Munich: The YouTube logo and lettering can be seen at a Google stand at the Media Days in Munich (Bavaria, Germany). The parent company of Google LLC is Alphabet Inc. Photo: Matthias Balk/dpa (Photo by Matthias Balk/picture alliance via Getty Images)
dpa/picture alliance via Getty Images
Google stock (NASDAQ: GOOG) has delivered solid growth, soaring 57% from approximately $160 in late April to over $250 today, a performance clearly backed by fundamental strength, among other developments.
While we assert that there is little fundamental risk to GOOG stock, given its consistently strong operational performance and financial health, our machine-driven multi-factor evaluation suggests a different course.
Our primary concern lies with the current valuation. Due to the stock’s Very High valuation, we rate it as Relatively Expensive. As a result, we believe it may be time to lessen exposure, as a pullback to around $230 is not beyond reach.
Below is our evaluation:
Our Stock Opinion – GOOG
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Let’s delve into details of each of the assessed factors, but first, for a quick background: With $3.1 Tril in market capitalization, Alphabet offers digital products and services including ads, Android, Chrome, Gmail, Maps, YouTube, cloud computing, and health technology across a variety of business segments.
[1] Valuation Appears Very High
GOOG Stock Valuation
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This table illustrates how GOOGL is valued compared to the broader market. For further details see: GOOGL Valuation Ratios
[2] Growth Is Strong
- Alphabet has experienced an average growth rate of 10.2% over the last 3 years
- Its revenues have increased by 13% from $328 Bil to $371 Bil in the past 12 months
- Additionally, its quarterly revenues rose by 13.8% to $96 Bil in the most recent quarter, up from $85 Bil a year ago.
GOOG Stock Revenue Growth
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This table demonstrates how GOOGL is expanding in comparison to the broader market. For more details see: GOOGL Revenue Comparison
[3] Profitability Appears Very Strong
- In the last 12 months, GOOGL’s operating income was $121 Bil, reflecting an operating margin of 32.7%
- With a cash flow margin of 36.0%, it generated nearly $134 Bil in operating cash flow during this time
- For the same period, GOOGL produced nearly $116 Bil in net income, which indicates a net margin of about 31.1%
GOOG Stock Profitability
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This table illustrates GOOGL’s profitability in comparison to the broader market. For further details see: GOOGL Operating Income Comparison
[4] Financial Stability Appears Very Strong
- At the end of the latest quarter, GOOGL debt stood at $36 Bil, while its current market cap is $3.1 Tril. This suggests a debt-to-equity ratio of 1.1%
- GOOGL’s cash (inclusive of cash equivalents) comprises $95 Bil of $502 Bil in total assets. This results in a cash-to-assets ratio of 19.0%
GOOG Stock Financial Stability
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[5] Downturn Resilience Is Moderate
GOOGL exhibited a slightly better impact than the S&P 500 index during various economic downturns. Our assessment is based on both (a) the magnitude of the stock’s decline and (b) the speed of its recovery.
2022 Inflation Shock
- GOOGL stock decreased by 44.3% from a peak of $149.84 on 18 November 2021 to $83.43 on 3 November 2022, compared to a peak-to-trough decline of 25.4% for the S&P 500.
- Nevertheless, the stock completely bounced back to its pre-Crisis peak by 25 January 2024
- Since then, the stock rose to a high of $256.55 on 20 October 2025, and now trades at $253.08
GOOG Stock Performance During The 2022 Inflation Shock
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2020 COVID-19 Pandemic
- GOOGL stock dropped 30.9% from a peak of $76.24 on 19 February 2020 to $52.71 on 23 March 2020 compared to a peak-to-trough decline of 33.9% for the S&P 500.
- Nonetheless, the stock entirely recovered to its pre-Crisis peak by 10 July 2020
GOOG Stock Performance During The 2020 COVID-19 Pandemic
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2008 Global Financial Crisis
- GOOGL stock plunged 65.3% from a high of $18.54 on 6 November 2007 to $6.44 on 24 November 2008 compared to a peak-to-trough decline of 56.8% for the S&P 500.
- However, the stock fully rebounded to its pre-Crisis peak by 24 September 2012
GOOG Stock Performance During The 2008 Global Financial Crisis
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