Q            TTM
Revenue    : $76.45B      $296.89B
EPS        : $1.55        $5.21

Stock      : $123.00
P/S (TTM)  : 5.25
PE (TTM)   : 29

Thoughts
* It was nice to see revenue growth hit double digits for the quarter, but on a TTM basis its still pretty 'mid'; this time last year they were at $286B and now $296B so up only 3.55%

* Margins improved and are likely at the high end of the range they can manage to - lots of layoffs that helped with bottom line and that was probably the source of most of the upside in EPS

* At 5x P/S (TTM) the stock is still at the lower end of the historical range (it has been as high as 8x) if you think this is the new normal and extrapolate out revenue through the next few quarters you might get to $335B in revenue and a stock price of $140 - $160 per share.  So still a fairly attractive investment case; and of course if multiples were to imprve the upside would be even higher.  I don't really foresee a major contraction in multiples so the bear case is hard for me to see (anyone?)

* The stalling of Google Cloud revenues I think shows how immature this business line is for Google - they are not managing the downturn in the market very well (or at least as well as AWS and MSFT Azure).  This is a $20B+ business and needs better leadership; it can't all be about the "tech" - managing the GTM needs to be a higher priority.  I am not super confident Google Cloud leadership understand this.  When times are good its easy to grow just with "sold tech and a good brand"; but it will take more than this now that the market is maturing.  

* Super Bullish on YouTube - and the numbers this quarter were strong.  I never bought into the TicTok headwind and it seems to be very well managed business

* I expect an advertising 'super cycle' as we get into the US election season next year; and Google is still very well positioned to take advantage of this.

PS: For those that care my super-simplistic model suggests fair value of $115 - $150 / share right now with a $130 at the midpoint which is what I often use to determine if I should add or lighten.  This uses a combination of EPS and Revenue multipliers.  

tecmo
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