With ongoing digitalization, the dependency on the internet services industry is increasing. According to a Broadband Search report, 63.2% of the world’s population uses the internet.
The rising dependence of governments, businesses, and individuals on internet-based services should drive the industry’s growth. The global internet service market is expected to reach $632.4 billion by 2027, registering a 5% CAGR. Furthermore, the growing popularity of the Internet of Things (IoT) in industries that include IT, education, banking, and healthcare is expected to propel the demand for services offered by internet companies.
Therefore, we think it could be wise to bet on quality internet stocks Alphabet Inc. (GOOGL – Get Rating), Facebook, Inc. (FB – Get Rating), Yelp Inc. (YELP – Get Rating), and Groupon, Inc. (GRPN – Get Rating). They are each expected to deliver substantial returns in the near term based on their consistent innovations, diverse portfolios of products, and strong sales growth.
With a market cap of $1.9 trillion, tech giant GOOGL is one of the most valuable companies in the world. It operates through Google services; Google Cloud; and Other Bets segments. Created through a restructuring in 2015, it is the world leader in digital ad revenue.
This month, one of GOOGL’s segments, Google Cloud, partnered with digital services provider T-Systems. The agreement should help both the companies build and deliver a large spectrum of next-generation sovereign cloud services for German enterprises and healthcare organizations. Also, this innovation should help customers host sensitive workloads on a sovereign cloud.
GOOGL’s revenue for the second quarter, ended June 30, 2021, increased 61.6% year-over-year to $61.88 billion. The company’s income from operations grew 203.3% from its year-ago value to $19.36 billion. Its net income rose 166.2% from the prior-year quarter to $18.53 billion. Also, the company’s EPS increased 169.1% year-over-year to $27.26.
Analysts expect GOOGL’s revenue to increase 37.4% year-over-year to $250.74 billion in its fiscal year 2021. Also, the company has an impressive earnings surprising history; it surpassed the consensus EPS estimates in each of the trailing four quarters. In addition, its EPS is expected to increase 72.2% in the current year. Moreover, the stock has gained 64% in price over the past nine months and 88.2% over the past year.
GOOGL’s strong fundamentals are reflected in its POWR Ratings. The stock has an overall B rating, which equates to a Buy in our proprietary rating system. The POWR Ratings assess stocks by 118 different factors, each with its own weighting.
Also, the stock has a B grade for Sentiment and Quality. We’ve also graded GOOGL for Momentum, Stability, Value, and Growth. Click here to access all GOOGL’s ratings. GOOGL is ranked #3 of 75 stocks in the Internet industry.
Popular social media platform provider FB is a multinational technology company that enables people to connect virtually. FB’s products include Facebook app, Messenger, Instagram, WhatsApp, Oculus, Workplace, Portal, and Novi. It has surpassed one billion registered accounts and had more than 2.85 billion monthly active users as of July 2021.
For the second quarter, ended June 30, 2021, FB’s revenue increased 55.6% year-over-year to $29.08 billion. The company’s income from operations grew 107.4% from its year-ago value to $12.37 billion. Its net income rose 100.7% from the prior-year quarter to $10.39 billion. Also, the company’s EPS increased 100.6% year-over-year to $3.61.
FB’s revenue is expected to increase 39% year-over-year to $119.49 billion in its fiscal year 2021. In addition, the company has an impressive earnings surprise history; it beat the consensus EPS estimates in each of the trailing four quarters. Its EPS is expected to increase by 40.1% in the current year. Over the past six months…
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