A man walks past the logo of the US multinational technology company Google during the VivaTech … [+] trade fair ( Viva Technology), on May 24, 2018 in Paris. (Photo by ALAIN JOCARD / AFP) (Photo credit should read ALAIN JOCARD/AFP via Getty Images)
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We believe that there are other stocks that are currently better valued than Alphabet (Google)’s stock (NASDAQ: GOOG). GOOG’s current price-to-operating income ratio (P/EBIT) of 30.3x is much higher than levels of 14.3x for Altra Industrial Motion (NASDAQ: AIMC), 7.38x for 1-800-FLOWERS.COM (NASDAQ: FLWS), 5.37x for Quidel (NASDAQ: QDEL) and 5.36x for Nexstar Broadcasting Group (NASDAQ: NXST). These stocks have a lower valuation (P/EBIT) compared to Google, while all of them have seen better revenue and operating income growth. This disconnect between valuation and performance could mean that you are better off buying AIMC, FLWS, QDEL and NXST vs. GOOG stock. More specifically, we arrive at our conclusion by looking at historical trends in revenues, operating income, and P/EBIT for these companies. Our dashboard – Better Bet Than GOOG Stock: Pay Less To Get More From Stocks AIMC, FLWS, QDEL, NXST- has more details – parts of which are summarized below.
1. Revenue Growth
Google’s revenue grew at an average rate of 18% over the last three years, as compared to average revenue growth of 28% for Altra Industrial Motion, 23% for 1-800-FLOWERS.COM, 100% for Quidel, and…