Alphabet Stock Chart: Buy the dip in the best member of the FAANG breed
The FAANG group has been random so far this year. Three of the components outperformed the Nasdaq’s 11.1% year-to-date loss, while two are wrong underperforming.
The Last Two — Meta (MVRS) – Get meta report and Netflix (NFLX) – Get the report from Netflix, Inc. — are down more than 30% so far this year.
Interestingly, none of the FAANG components are higher over the year. The best performer so far in 2022 is Apple (AAPL) – Get the Apple Inc., down 4.75%, tracked by Amazon (AMZN) – Get the report from Amazon.com, Inc..
Yet neither of these names is the bearish buy stock I am referring to. Instead, I’m talking about Alphabet (GOOGL) – Get the Class A report from Alphabet Inc. (GOOG) – Get the Class C report from Alphabet Inc..
Alphabet is the best performing FAANG stock over the past 12 months and that’s even after it traded sideways over the last four months of 2021.
Plus, it’s just coming off a better-than-expected and, quite frankly, robust quarterly report. In this report, the company also declared a 20-to-1 stock split.
The news was enough to send Alphabet stock to new all-time highs.
After eclipsing the previous high at around $3,019, the stock peaked at around $3,031 and has been falling for the past few weeks.
I think it’s a dip worth buying.
Buy the dip in the alphabet stock
I was a bit conflicted here because to some extent, as Nasdaq is, so is Alphabet.
While it’s possible Alphabet could outperform the Nasdaq — just as it has over the past one, three, six and 12 month periods — that doesn’t mean increased selling pressure in the market. index will not harm the stock.
That said, we already have gains on the table as a risk (and rather have it as a reward in our back pocket).
We know that when – not if – buyers return to the market, they will go to high-quality, successful businesses, and Alphabet is one of those businesses. We just don’t know where the bottom is.
At today’s low, Alphabet stock was down about 12% from the post-earnings high. Admittedly, it is struggling to maintain the 200-day moving average and sits below a number of key short-term moving averages.
But he tries to find his place. Should sales in the overall market accelerate, Alphabet stock could be looking at a test of the 50-week moving average and the fourth-quarter low.
I don’t know if Alphabet will make new lows. If so, I wouldn’t be surprised in this climate. But bulls should be looking for high-quality companies that have strong earnings and strong underlying businesses.
Alphabet Has All These Attributes And Now Bulls Can Buy It after a great quarter at a lower price than it was before printing – and at a 12% discount from highs.
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