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FAANG Stocks: Alphabet (GOOGL) Leading Year to Date Growth Surge

American multinational technology company, Alphabet Inc (NASDAQ: GOOGL) is currently stealing the show as it inks the best growth performance amongst the FAANG stocks on the year-to-date basis. The Mountain View, California-based firm’s stock closed Wednesday’s trading session with a 0.36% gain, adding $10.36 to its share price which was pegged at $2,904.31. In today’s pre-market, the stock has inched forward by a slight gain of 0.093%.

The recent performance of Alphabet has further solidified its runs since the beginning of the year. In the previous month, only American over-the-top content platform and production company, Netflix Inc (NASDAQ: NFLX) saw a higher growth push than Alphabet. While the former recorded a 12.8% growth, the latter added 8.2% to its price tag.

On the year to date basis, Alphabet is up by 66%, with the next best performer, Facebook Inc (NASDAQ: FB) recorded just a 40% gain within the same period. 

“We view this part of a risk-on trade and many investors playing a digital advertising tidal wave of demand that is clearly putting tailwinds into the stock. Also, Google is having success with cloud services which is another leg to the growth story as they play catch-up to Microsoft and Amazon,” Wedbush Securities tech analyst Dan Ives tells Yahoo Finance. 

Despite the impressive revenue records of Microsoft Corporation (NASDAQ: MSFT) in the past quarters, its share price performance of 36% year to date still lags behind those of Alphabet. Of the FAANG stocks, Netflix is the worst performer this year with just an 8% increase year-to-date.

Alphabet Growth Takes Backing from Improved Cost Management

The unprecedented growth in the shares of Alphabet is backed by the impressive business performance figures recorded in the previous quarter. As reported by Yahoo Finance, the company’s second-quarter sales rose 62% from the prior year to $61.9 billion. Operating profit margins expanded to 31% from 17% a year earlier. 

“Google continues to grow revenue and EPS at a ~20% CAGR on a normalized basis. The company continues to innovate its product, and its machine learning capabilities should help advertisers get higher ROI, causing them to continue to allocate their advertising budgets to Google,” Barclays tech analyst Ross Sandler wrote in a research note earlier this month. 

The company has also been making impressive advances in its cloud service offerings, part of its business unit that is taking the competition directly to Microsoft Azure and Amazon Web Service. With the latest uptick in its share price, Alphabet has grown its market capitalization to $1.94 trillion, making it the third most valuable company after Apple Inc (NASDAQ: AAPL), and Microsoft.

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FAANG Stocks: Alphabet (GOOGL) Leading Year to Date Growth Surge