Alphabet (GOOG): Be Aware Of Tough Comps Ahead - Suntrust
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SunTrust Robinson Humphrey analyst, Bob Peck, reiterated his Buy rating on shares of Alphabet (NASDAQ: GOOG) (NASDAQ: GOOGL) as the company partially laps the third ad link on Mobile, which has been a key driver of elevated growth since 3Q'15.
Google has launched several new features, like the fourth link (expanded text ads) but the critical issue is the anticipated slow down in 3Q'16. The analyst expects Sites revenue to decelerate ~450 bps q/q, in line with consensus.
The analyst believes the risk-reward remains attractive as GOOGL trades at ~16x P/E ex cash and a PEG of <1x vs large cap tech companies at a median PEG of ~1.5x. No change to the price target of $900.
Shares of Alphabet closed at $776.43 yesterday.
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