Alphab Rg-C-NV

Global Markets Comment

Alphabet is our top pick within the big cap internet names tactically as it has been a laggard with improved fundamentals. We see upsides to its digital advertising recovery (in part driven by upsides on travel ad spend – which could happen near term), upside from its push into eCommerce (integrating search and eCommerce), localizing advertising offerings via Local & maps and revenue & margin upside from scaling up of its cloud offering. After a strong set of results, Alphabet has seen earnings upgrades & rising price targets and we con􀆟nue to expect re-rating to continue over the next few weeks / months.

Performance since inception*

Company Profile

Alphabet is a holding company composed of Google and a collection of businesses called Other Bets. In 2018, Google Sites were the most visited internet properties in the world, led by visits to its core search engine. Google leads the development of the Android mobile operating system and owns YouTube. In 2018, 76% of Alphabet

Price History 1 year

Investment Case

Growth in mobile search & YouTube will sustain solid growth in Alphabet's core Google operations with growing momentum from Cloud. Longer term, achieving a balance btwn innovation (e.g., "Other Bets") & SH expectations will be key to the investment story. We believe investors will be satidfied if GOOG can deliver a) greater clarity and consistency in core OI margins; b) low-to-mid teens rev growth; and/or c) a consistent SH return policy over the LT.

Price History 5 years

Risk in Investment Case

The rapid pace of evolution in the Internet and Technology sectors, including the emergence of new competition and new form factors of hardware devices, could cause a shift in user behavior that diverts traffic away from Alphabet. Additional key risks include regulatory scrutiny over anti-competitive practices, intellectual property claims, a failure to effectively integrate and manage acquisitions, macroeconomic impacts on global advertising budgets, currency fluctuations, interruption of information technology and communications systems (i.e., natural disasters, terrorism, denial of service attacks, etc.), damage to the Google brand, concentrated voting control, and regulatory risks (particularly ongoing antitrust investigations in the EU).

Hong Kong & Singapore Private Clients

PLEASE READ THESE TERMS AND CONDITIONS CAREFULLY BEFORE PROCEEDING. BY UTILIZING THE WEBSITE AND PAGES THEREOF LOCATED AT WWW.UBS.COM ("WEBSITE"), YOU ACKNOWLEDGE THAT YOU HAVE READ THESE TERMS AS WELL AS THE GLOBAL TERMS OF USE (collectively "TERMS") AND THAT YOU AGREE TO BE BOUND BY THEM. IF YOU DO NOT AGREE TO ALL OF THE TERMS OF THIS AGREEMENT, YOU ARE NOT AN AUTHORIZED USER OF THESE SERVICES AND YOU SHOULD NOT USE THIS WEBSITE.

Investor status

  • Confirm that I meet the requirements to qualify as:
  • a "Professional Investor” in accordance with Section 1 of Part 1 of Schedule 1 of the Securities and Futures Ordinance (Cap 571 of the Law of Hong Kong) and as a “Private Banking Customer” as defined in the circular issued by the Hong Kong Monetary Authority on 12 June 2012; and/ or
  • an "accredited investor" or "institutional investor" as defined in the Securities and Futures Act (Chapter 289) of Singapore

Disclaimer

Content provided on “as is” and “as available” basis

  • Confirm my understanding that the materials, information or reports published, distributed or otherwise made available on the UBS Website
    (a) are published for information purposes only and are subject to change at any time without notice;
    (b) have been created without any regard to the specific investment objectives, financial situation or particular needs of any specific recipient and should not be construed as a solicitation, offer or recommendation or advice to buy or sell any securities, investment or other financial instruments, to effect any transactions or to conclude any legal act of any kind whatsoever.
Reset