Shares of Alphabet Inc GOOGL are headed in one direction, according to MKM Partners: Up.
Google reported first-quarter sales of $24.75 billion versus a $24.22 billion estimate on April 27.
“We consider [Google] shares an attractive value considering its premium position in the media landscape, impressive growth and valuation of media incumbents,” MKM Partners Managing Director Rob Sanderson said in a note.
MKM raised its price target on Google from $1,000 to $1,170.
Google’s website growth and core margin expansion were positive, Sanderson said, adding that the only missing piece of the company’s results was a “more aggressive” buyback.
Running Revenue Circles Around Facebook
The $70 billion web advertising business is “still growing by 21 percent,” Sanderson said.
Google added more than $15 billion in revenue on a trailing 12-month basis, a number equivalent to more than half of Facebook Inc FB’s business as a whole, the analyst said.
Investor sentiment “has softened somewhat” after an advertising boycott fueled by objectionable content paired with YouTube ads, Sanderson said, but added that the company’s strong financial results and management’s comment on the boycott should put shareholders at ease.
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