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Alphabet ( GOOGL ) shares sunk Friday, as the stock was handed at least seven price-target cuts after the world’s largest Internet company posted Q1 earnings and sales late Thursday that missed Wall Street’s expectations . Still, many analysts remained upbeat about the search leader’s prospects. Alphabet stock fell 5.4% on the stock market today , to 737.77 and falling just below the key 10-week line, testing a stock that broke out of cup-with-handle base at a 777.41 buy point last week. Shares are now down 5.4% from the buy point and near the recommended selling range of down 7% to 8%. But the stock has risen more than 30% over the last 12 months, helping Alphabet gain a spot on the IBD 50 list of leading growth stocks. Alphabet shares touched their all-time high of 810.35 on Feb. 2. IBD’s Take: How healthy is Alphabet’s stock and those its main rivals? Find out at IBD Stock Checkup Leading social network Facebook ( FB ), Alphabet’s top rival for digital advertising dollars, also saw its stock fall on Friday. Facebook stock fell 2.5% Friday, to 110.56. Facebook is set to report earnings on Wednesday after the close. Analysts saw the Q1 miss as a temporary stumble. “Looking past the headlines, we see several favorable trends,” Monness Crespi Hardt analyst James Cakmak said in a research report Friday. “First, the core operating margin is improving, expanding 140 basis points to 37.8%. “Second, although ‘other bets’ losses widened to $802 (million from $633 million), losses rose at significantly slower rates than revenue, thereby yielding more moderate growth in the net figure. Third, the primary growth driver for Google is mobile search. We cannot emphasize this enough, as what used to be a headwind for the company is now becoming a tailwind. Further to that, key assets like YouTube and programmatic (ad) efforts are on the upswing. And fourth, we are finally seeing the balance sheet put to work with $2.1 billion in repurchase.” With its earnings release, Alphabet said that during Q1 it spent $2.1 billion on share repurchases, and that it still has $1.4 billion in repurchase authorization, with no expiration date. Revenue was a “modest disappointment,” wrote Pacific Crest analyst Evan Wilson in a research note, but adding that “we believe that’s more than offset by a new passion for expense control. We remain excited about the combination of revenue growth, expense control and cash return and would be buyers of GOOGL.” He maintained his overweight rating on Google stock, with a price target of 910. Image provided by Shutterstock . Scalper1 News
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