Google's Underperformance = Buying Opportunity for Investors
Susquehanna analyst Brian Nowak sees an "attractive buying opportunity" in Google (NASDAQ: GOOG) shares recent underperformance.
Google is estimated to report second quarter earnings on July 14. Nowak expects the company to beat revenue and EPS estimates in the upcoming quarters despite record operating expenses growth. The analyst added that shares have lagged in the past two months, trading at an approximate 10 percent discount to the historical PE multiple.
Susquehanna remarked that Google's underperformance was driven by first quarter opex, but there is "nothing broken" with the core growth story and opportunity. Nowak emphasized that the company has historically outperformed in the second half of the fiscal year.
The analyst said that consensus revenue and EPS estimates are too bearish. Susquehanna reported that recent industry checks confirm Google's strength in ad budget growth.
Shares of Google closed at $564.95 on Monday. The stock is currently up 0.92 percent at $570.17.
Latest Ratings for GOOG
|Mar 2015||Axiom||Initiates Coverage on||Hold|
|Jan 2015||JMP Securities||Maintains||Market Outperform|
|Jan 2015||Societe Generale||Initiates Coverage on||Buy|
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