Out Fox The $treet

  Google reported strong Q3'23 results, beating analyst revenue estimates by nearly $1 billion. Google Cloud grew by 22% to $8.4 billion, but investors focused on the small miss in this segment rather than the big beats in other categories. The stock is cheap at ~13.5x EPS targets and a relative bargain to other tech giants. After reporting a generally strong quarter,  Alphabet Inc.  ( NASDAQ: GOOG ,  NASDAQ: GOOGL ), aka Google, has seen the stock collapse. The AI-powered Search giant disappointed the market with weakness in the Cloud sector, yet the results weren't so spooky. My  investment thesis  is ultra Bullish with Google trading down nearly $20 from the recent highs that weren't even above the 2021 highs, unlike other mega tech stocks. Read the full article on Seeking Alpha.  Disclosure: No position mentioned. Please review the disclaimer page for more details. 

Google reports Q2 2023 results after the close today, July 25, with revenue growth reaccelerating to 4.4%. The internet search giant appears to be working with Apple Inc. on internal AI plans in a good sign Google Cloud will see strong growth. The stock remains cheap at only 14x non-GAAP EPS targets for '25 with additional upside of AI and further efficiency gains. One major outcome of the apparent  Apple Inc.  ( AAPL ) AI endeavor is a heavy reliance on  Alphabet Inc.  ( NASDAQ: GOOG ,  NASDAQ: GOOGL ), aka Google. The tech giant has invested heavily in AI tools over the last  several years and appears well-positioned with Google Cloud to benefit from surging demand for data center space. My  investment thesis  remains ultra Bullish on Google heading into Q2 '23 earnings after the close on Tuesday, July 25. Read the full item on Seeking Alpha.  Disclosure: No position mentioned. Please review the disclaimer page for more details....

  Alphabet/Google continues to trade risk-off due to fears that Bing Chat is a major risk to the search market. The market fears over Google losing default search deals for mobile traffic from Apple and Samsung are misplaced. Google stock trades at an EV of only ~11x '25 EPS estimates. Within days, media reports have suggested  Alphabet Inc.  ( NASDAQ: GOOG ,  NASDAQ: GOOGL ) aka Google was at risk of losing search mobile browser default settings due primarily to new AI options.  Microsoft Corporation  ( MSFT ) search  engine Bing is definitely a threat in AI, but the stock market is too fearful of this threat in Internet search. My  investment thesis  remains ultra Bullish on Google based on the cheap valuation and its dominant position in mobile search that is unlikely to be impacted by losing default browser settings. Read the full article on Seeking Alpha.  Disclosure: No position mentioned. Please review the disclaimer page for mor...

Google slumped last week following an underwhelming AI chat launch. The company obtains all of their profits from the Google Services business focused on Google search causing the market to excessively worry about competitive threats. The stock trades with an EV of 10x '25 non-GAAP EPS targets even before expected efficiency gains. Alphabet  ( NASDAQ: GOOG ,  NASDAQ: GOOGL ) collapsed this week following a failed answer in a tweet launching a new conversational AI service. The market was overly dramatic on the outcome of the AI event hosted by Google, especially considering ChatGPT  has several high profile failures. My  investment thesis  is ultra Bullish on the stock following the major dip back below $95. Read the full article on Seeking Alpha.  Disclosure: No position mentioned. Please review the disclaimer page for more details. 

Google is the apparent winner of the NFL Sunday Ticket at a cost of $2+ billion. The financials of the NFL deal don't add up to a winning deal. The stock is cheap at ~13x EPS targets, but over paying for the Sunday Ticket is a bad move for shareholders. This idea was discussed in more depth with members of my private investing community, Out Fox The Street.  Learn More »   When DirecTV, still 70% owned by  AT&T  ( T ), didn't want to pay another $1.5 billion for the NFL Sunday Ticket, investors have to wonder why big tech wanted to pay even more.  Google  ( NASDAQ: GOOG ,  NASDAQ: GOOGL ) battled with  Apple  ( AAPL ) for the right to overpay for limited out-of-market NFL games. Read the full article on Seeking Alpha.  Disclosure: No position mentioned. Please review the disclaimer page for more details. 

Alphabet made a small smartwatch technology purchase. The company has a long history of hardware failures and a smartwatch push will likely be no exception. Alphabet continues losing substantial amounts of money on Other Bets and generates low margins on hardware. The stock is incredibly cheap based on ex-cash, 2020 non-GAAP EPS estimates of up to $71. On Christmas Eve, my   previous research   extolled the benefits of buying   Alphabe t   ( GOOG ,   GOOGL ) despite doubts that the company would successfully transition to material hardware sales. The company appears to have an unhealthy appetite for hardware with the latest purchase suggesting another losing push into smartwatches. Regardless, the stock remains a buy even after a $115 rally in under a month to over $1,100. Read the full article on Seeking Alpha.  Disclosure: Long AAPL, FIT. Please review the disclaimer page for more details.   

Alphabet is positioned for substantial hardware revenue growth. The hardware division isn't positioned as a profit driver due to low margins. The smart speaker business isn't materializing as a direct profit driver as consumers shy away from voice commerce purchases. The stock remains cheap based on an enterprise value, trading at only 13.4x forward EPS estimates. As other tech giants make the move to high-margin services,  Alphabet ( GOOG ,  GOOGL ) continues making the odd shift into hardware. A big part of the move is to lock consumers into their services and advertising revenue streams. The stock remains incredibly cheap back below $1,000 as highlighted in my  previous research , but the push into hardware isn't likely to contribute to this valuation. Read the full article on Seeking Alpha.  Disclosure: Long AAPL. Please review the disclaimer page for more details. 

Google CEO confirmed the company wasn't planning on entering the Chinese search market. Oddly, Baidu ended down on the day despite this bullish news. The stock trades at only 13.5x '20 EPS estimates despite double the growth rate. Baidu   ( BIDU ) remains one of the more perplexing stocks in the market. Despite a blooming Chinese internet sector, the market always has an excuse for avoiding the stock. My long-term   investment thesis   hasn't changed, and the stock only becomes a better bargain on every dip. Read the full article on Seeking Alpha. 

Baidu continues to slump to multi-year lows. The Chinese company has growth opportunities outside internet search in voice assistants and self-driving cars, among others. The stock remains exceptionally cheap in the large-cap technology sector as margins rebound with the exit of transaction-related businesses. The general weakness in Chinese tech stocks provides a substantial opportunity for a stock like Baidu ( BIDU ). The internet search leader in China has in-roads to new technologies and the Chinese economy is still transitioning online while the economy is growing at one of the fastest rates in the world. My investment research continues to support buying weakness in the stock, especially on irrational fears related to Google ( GOOG , GOOGL ) entering the Chinese internet search market. Read the full article on Seeking Alpha. 

Apple apparently obtained a large hike to the fees Google pay as the default search browser on Apple products. Google has recently complained about the rising TAC. The near pure profit search revenues should boost FY19 EPS targets towards $14.50. One doesn't have to look very hard to make a   bullish thesis   on   Apple   ( AAPL ) based on their growth in the Services division. The shocking news of the last week is that a portion of the revenue base is set for a major boost thanks to   Google   ( GOOG ,   GOOGL ). These high-margin revenues might provide a bigger boost to the bottom line than the new iPhones. Read the full article on Seeking Alpha.  Disclosure: Long AAPL. Please review the disclaimer page for more details.   

Alphabet surges to new highs based on surpassing Q3'15 estimates. A big rationale for the recent gains isn't so apparent in the Q3 details that suggest financial discipline isn't in place following the hiring of the new CFO. The stock likely continues rallying based on momentum until year-end before the market wakes up to the higher levels spent on other bets. The investment thesis about 150 points and a name ago was that the stock of Alphabet (NASDAQ: GOOG ) (NASDAQ: GOOGL ) would soar based on a grownup running the show. The prediction was that the stock had significant ability to not only grow earnings, but obtain higher multiples from the market with better financial stewardship. Read the full article at Seeking Alpha. Disclosure: No position mentioned. Please review the disclaimer page for more details. 

Signs are emerging that the new CFO is starting to implement some financial discipline at Google. The Internet search giant has long frustrated shareholders with out of control expenses. Google has operating margins far below the other tech giants. A grown up Google could head much higher. The hiring of a new CFO a few months back had shareholders hopeful that the new finance leader would help constrain the spending at Google (NASDAQ: GOOG ) (NASDAQ: GOOGL ) . The Internet search leader has long spent heavy on research and development for projects far astray of the main money generator. Read the full article on Seeking Alpha. Disclosure: Please review the disclaimer page for more details. 

Google recently announced Android Pay as a launch partner with a new tokenization security service from Visa. The Visa plan includes blocking transaction fees on mobile payments for technology companies like Google. Google is positioned to benefit long term via other arrangements including marketing fees from credit card issuers and loyalty programs with consumers. Making money off any service is always a nice outcome, but sometimes the intent of services is to maintain customer loyalty or attract new customers. In the case of mobile payments, the vision heading into the end of May was that new payment providers would collect small fees that might eventually add up to billions. The news of the day suggests that the apple cart might have been turned over by the payment processors of Visa (NYSE: V ) and MasterCard (NYSE: MA ). Read the full article on Seeking Alpha. Disclosure: Long AAPL. Please review the disclaimer page for more details....

Summary Yelp trades at multi-year lows due to user problems and an unflattering documentary. Mobile app provides a solution to the user problem, but it requires execution. Yelp remains an extremely attractive valuation with plenty of upside potential if it can execute on the mobile potential. Though claims continue to persist that Yelp (NYSE: YELP ) extorts business owners to extract advertising spending, Google (NASDAQ: GOOG ) (NASDAQ: GOOGL ) remains the biggest issue. While the Kickstarter documentary is a headache and a concern that could plague Yelp for a while, the company actually has a solution to the Google problem, if it executes. Read the full article on Seeking Alpha. Disclosure: Long YELP. Please review the disclaimer page for more details. 

Summary Stock split raises corporate governance issues. Stock could lose momentum with investors inclined to trim shares after long run. Unforeseen threats could hit the stock similar to MasterCard. Next week, Google ( GOOG ) plans to finally split its stock nearly two years after announcing the original plan. After a relentless run beyond $1,000, the stock is actually being split for an unrelated reason that brings up corporate governance concerns. Even the market cap reaching $376 billion and annual sales expected to reach over $70 billion this year, Google remains a fast growing technology leader. The company still obtains the majority of revenue from online search even though it continues to attempt diversification into mobile operating software and wearable devices amongst other far-flung operations. Read the full article at Seeking Alpha. Disclosure: No positions mentioned. Please review the disclaimer page for more details. 

Interesting infographic off all the products that Google (GOOG) has killed over the years. The company continues to build product after product yet search is the only real money maker. The Android operating system is clearly successful, but it still isn't a cash cow like search. Disclosure: No positions mentioned. Please review the disclaimer page for more details. 

Great discussion on mobile advertising. Long video but worth watching if your interested in the mobile ad sector such as Google (GOOG) and  Millennial Media (MM) . For those paying attention, Millennial Media trades near all time lows yet there the ones involved in a discussion with Google. Disclosure: Long MM. Please review the disclaimer page for more details. 

Based on the post earnings sell-off of Baidu ( BIDU ) , investors now get the opportunity to buy the market leader in the explosive Chinese market at a substantial discount to growth potential. While investors fret over the increased costs and the transition to mobile search, they missed the big picture that mobile will eventually lead to much higher traffic for a country with only 42% Internet penetration. The company is the leading Chinese language Internet search provider with over 70% market share. As mentioned prior to earnings on February 4th, the company is an extreme value with strong growth potential. The stock reached close to all-time highs last April around $150 and a market value of $55B. The stock fell off the China cliff until December and has returned back to those levels since the recent sell-off. While investors mull over more competition from Qihoo 360 Technology ( QIHU ), the real issue remains a market transition outside of the control of the comp...