Alphabet eyes $2 trillion value after blowout results
The blowout quarterly report reveals Alphabet, the parent company of Google, is eyeing joining Apple and Microsoft in the $2 trillion valuation club. The market immediately responded positively with a surge in the value of the shares by about 8 percent. The shares traded at $2,975 with its greatest one-day percentage jump in the period of about the past two years.
The market value crossed a milestone of $2 trillion with the start of the new trading day. It was last at $1.97 trillion. However, the holdings include class B shares which are owned by insiders and are not traded in the market.
2022 started with a positive note for the technology sector even though a couple of question marks existed since the dot-com crash in 2000. The highest and largest quality tech firms in the US have continued delivering answers with their outstanding earnings beats.
The past two years witnessed a great surge in the share prices of most tech companies driven by the COVID-19 pandemic that led to people working from home and were forced to remain indoors even though regulators scrutinized them over breach of privacy allegations as well as antitrust concerns.
Meanwhile, about two dozen brokerage houses have raised their target price on the company's stock. The new price target is higher by 16 percent over the current price at $3,450.
Alphabet lately announced a stock split in the ratio of 20:1. This means a shareholder is to receive 19 more shares over each unit of holding. The move is said to be attracting more investors as prices of each unit would come down.
Apple and Tesla followed the same stock split strategy in 2020. Their shares became more accessible to individual investors. However, the market capitalization remains the same as only the number of shares is increased and not the value of each share.