Should You Place Call Options Or Put Options On Alphabet?

Alphabet Inc. (GOOG) has hogged the headlines in recent weeks as one of the top tech companies in the world. And the earnings reports certainly give credence to this perception: Google has performed remarkably well while Apple Inc. (AAPL) has floundered. Before we get into the mechanics of call options or put options, it is important to analyze most every aspect of the latest data pertaining to Alphabet Inc. Analysts have given this stock a mean recommendation rating of 1.6. On a rating scale of 1.0 (strong buy) to 5.0 (strong sell), Alphabet Inc is clearly in bullish territory. The mean target price for the stock is $924.42, with a high of $1,080 and a low of $800. Looking at those numbers alone, it is clear to see that the current price of the stock is undervalued.

I would like to take this opportunity to drill down into the nitty-gritty of Alphabet Inc, so that we can clearly ascertain how the stock is doing and how investor sentiment is driving Alphabet on the markets.

Trailing Total Returns

Yesterday, the stock closed at $706.85 on the Nasdaq (QQQ). During the course of the day, the stock gained $5.83 for a gain of 0.83%. In terms of actual volume of shares traded, the number was 3.01 million. Here is where it gets interesting with Alphabet Inc – the stock has gained 28.82% over the past 52 weeks. For the year to date, it has shed 10.64%. By contrast, Apple Incorporated has lost 18.92% over 1 year, and the company has lost 9.26% for the year to date. The heavy losses suffered by both of these companies in 2016 are largely a result of global economic uncertainty fueled by China weakness, the commodity price rout, and fears of deflation in Japan and the Eurozone. There is structural weakness in emerging market economies as exports have tapered off; a strong USD has dragged demand for commodities lower, and financial stocks have taken a pounding. Viewed in perspective, the declines suffered by Alphabet Inc. and Apple Inc. aren’t quite as bad as the 20% to 30% suffered by financial stocks and the Chinese equity markets in the Shenzhen Composite Index and the Shanghai Composite Index.