Alphabet Stock Lost 10% In One Week, What’s Next?

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Alphabet (Google’s) stock (NASDAQ: GOOG) has lost 9.8% in the last week, underperforming the S&P 500 (down 1%). Further, the same trend was observed over the last ten days (-5.8% vs 0.6%) and one month period (2.8% vs 3.2%). 

The stock price suffered last week after the company’s new Bard AI (artificial intelligence) chatbot offered a wrong answer in a promotional video. The market reacted sharply to this fiasco, eroding around $100 billion in GOOG’s market value. Notably, the firm is heavily dependent on the Google search segment, which generates more than 55% of the total revenues. Further, the recent announcement by Microsoft to integrate ChatGPT AI chatbot with its search engine Bing has raised stakes for Google in the search engine space.

Before this, the global technology giant posted weak results in the fourth quarter of 2022 (released on February 2), with revenues and earnings missing the street estimates. It reported total revenues of $76 billion – up 1% y-o-y. While the Google services revenues (including Google search, YouTube ads, Google network, etc.) saw negative growth, it was offset by growth in the Google cloud segment and higher hedging gains.

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Now, is GOOG stock set to drop further, or could we expect some recovery? We believe that there is a 59% chance of a rise in Alphabet stock over the next month (21 trading days) based on our machine-learning analysis of trends in the stock price over the last seven years. See our analysis on Alphabet (Google) Stock Chance of Rise.

Twenty-One Day: GOOG 2.8%, vs. S&P500 3.2%; Underperformed market

(42% likelihood event; 59% probability of rise over next 21 days)

  • Alphabet stock gained 2.8% over the last twenty-one trading days (one month), compared to a broader market (S&P500) increase of 3.2%
  • A change of 2.8% or more over twenty-one trading days is a 42% likelihood event, which has occurred 781 times out of 1851 in the last seven years
  • Of these 781 instances, the stock has seen a positive movement over the next twenty-one trading days on 463 occasions
  • This points to a 59% probability for the stock rising over the next twenty-one trading days

Ten Day: GOOG -5.8%, vs. S&P500 0.6%; Underperformed market

(9% likelihood event; 54% probability of rise over next 10 days)

  • Alphabet stock decreased 5.8% over the last ten trading days (two weeks), compared to broader market (S&P500) gain of 0.6%
  • A change of 5.8% or more over ten trading days is a 9% likelihood event, which has occurred 167 times out of 1853 in the last seven years
  • Of these 167 instances, the stock has seen a positive movement over the next ten trading days on 90 occasions
  • This points to a 54% probability for the stock rising over the next ten trading days

Five Day: GOOG -9.8%, vs. S&P500 -1%; Underperformed market

(less than 1% likelihood event; 56% probability of rise over next five days)

  • Alphabet stock lost 9.8% over a five-day trading period ending 02/10/2023, compared to the broader market (S&P500) decrease of -1%
  • A change of -9.8% or more over five trading days (one week) is a less than 1% likelihood event, which has occurred 18 times out of 1853 in the last seven years
  • Of these 18 instances, the stock has seen a positive movement over the next five trading days on 10 occasions
  • This points to a 56% probability for the stock rising over the next five trading days

Check out how Alphabet (Google) Peers fare on metrics that matter. You will find other useful comparisons for companies across industries at Peer Comparisons.

What if you’re looking for a more balanced portfolio instead? Our high-quality portfolio and multi-strategy portfolio have beaten the market consistently since the end of 2016.

 Returns Feb 2023
MTD [1]
2023
YTD [1]
2017-23
Total [2]
 GOOG Return -5% 7% 146%
 S&P 500 Return 0% 7% 83%
 Trefis Multi-Strategy Portfolio -2% 10% 245%

[1] Month-to-date and year-to-date as of 2/13/2023
[2] Cumulative total returns since the end of 2016

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