GOOG Intrinsic Value

Intrinsic Value of GOOG Overview

Key Highlights:
As of Mar 24, 2025 GOOG Relative Value is $186.5, which is undervalued by 9.7%, compared to current share price of $169.9.
As of Mar 24, 2025 GOOG DCF Value is $127.9, which is overvalued by 24.7%, compared to current share price of $169.9.
Methodology
Price per share, $
Current share price
169.9

GOOG Historical Intrinsic Value

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GOOG Valuation Metrics

LTM
NTM
1Y Forward
2Y Forward
EV/Revenue
5.7x (as of Mar 24, 2025)
EV/Gross Profit
9.7x (as of Mar 24, 2025)
EV/EBIT
17.6x (as of Mar 24, 2025)
EV/EBITDA
15.2x (as of Mar 24, 2025)
EV/FCF
27.2x (as of Mar 24, 2025)
EV/OCF
15.8x (as of Mar 24, 2025)
P/Revenue
5.9x (as of Mar 24, 2025)
P/Gross Profit
10.1x (as of Mar 24, 2025)
P/EBIT
18.2x (as of Mar 24, 2025)
P/EBITDA
15.8x (as of Mar 24, 2025)
P/FCF
28.2x (as of Mar 24, 2025)
P/OCF
16.4x (as of Mar 24, 2025)
P/E
20.5x (as of Mar 24, 2025)
P/BV
6.3x (as of Mar 24, 2025)
PEG 1Y
1.9x (as of Mar 24, 2025)

GOOG DCF Model

Free Cash Flow to Firm Model
NOPAT Model
Free Cash Flow to Equity Model
Net Income Model
Millions
Billions
Dec'20 ActualDec'21 ActualDec'22 ActualDec'23 ActualDec'24 ActualDec'25 EstimateDec'26 EstimateDec'27 EstimateDec'28 EstimateDec'29 EstimateDec'30 EstimateDec'31 EstimateDec'32 EstimateDec'33 EstimateDec'34 EstimateDec'35 Terminal
% growth
182,527.0
12.8%
257,637.0
41.2%
282,836.0
9.8%
307,394.0
8.7%
350,018.0
13.9%
389,762.9
11.4%
432,794.4
11.0%
480,422.5
11.0%
526,961.0
9.7%
600,764.8
14.0%
673,385.0
12.1%
741,870.7
10.2%
803,095.6
8.3%
853,973.2
6.3%
891,698.2
4.4%
913,990.7
2.5%
41,224.0
22.6%
78,714.0
30.6%
74,842.0
26.5%
84,293.0
27.4%
112,390.0
32.1%
116,454.2
29.9%
129,311.3
29.9%
143,541.7
29.9%
157,446.6
29.9%
179,497.8
29.9%
201,195.4
29.9%
221,657.7
29.9%
239,950.6
29.9%
255,151.9
29.9%
266,423.5
29.9%
273,084.1
29.9%
NOPAT
% effective tax rate
34,525.4
18.9%
65,960.5
25.6%
62,926.5
22.2%
72,569.1
23.6%
93,913.6
26.8%
97,309.7
25.0%
108,053.1
25.0%
119,944.1
25.0%
131,563.1
25.0%
149,989.2
25.0%
168,119.9
25.0%
185,218.3
25.0%
200,503.9
25.0%
213,206.2
25.0%
222,624.8
25.0%
228,190.4
25.0%
% of revenue
13,697.0
7.5%
12,441.0
4.8%
13,475.0
4.8%
11,946.0
3.9%
0.0
0.0%
11,238.8
2.9%
12,479.6
2.9%
13,852.9
2.9%
15,194.9
2.9%
17,323.0
2.9%
19,417.0
2.9%
21,391.7
2.9%
23,157.2
2.9%
24,624.2
2.9%
25,712.0
2.9%
26,354.8
2.9%
% of revenue
(22,281.0)
(12.2%)
(24,640.0)
(9.6%)
(31,485.0)
(11.1%)
(32,251.0)
(10.5%)
(52,535.0)
(15.0%)
(47,593.8)
(12.2%)
(52,848.3)
(12.2%)
(58,664.2)
(12.2%)
(64,347.0)
(12.2%)
(73,359.1)
(12.2%)
(82,226.7)
(12.2%)
(90,589.5)
(12.2%)
(98,065.6)
(12.2%)
(104,278.3)
(12.2%)
(108,884.9)
(12.2%)
(111,607.0)
(12.2%)
1,827.0
1.0%
(1,523.0)
(0.6%)
(2,235.0)
(0.8%)
(3,845.0)
(1.3%)
(8,406.0)
(2.4%)
(5,771.9)
(1.5%)
(6,409.2)
(1.5%)
(7,114.5)
(1.5%)
(7,803.7)
(1.5%)
(8,896.6)
(1.5%)
(9,972.0)
(1.5%)
(10,986.2)
(1.5%)
(11,892.9)
(1.5%)
(12,646.3)
(1.5%)
(13,205.0)
(1.5%)
(13,535.1)
(1.5%)
Free Cash Flow to Firm (FCFF)
% of revenue
27,768.4
15.2%
52,238.5
20.3%
42,681.5
15.1%
48,419.1
15.8%
32,972.6
9.4%
55,182.8
14.2%
61,275.2
14.2%
68,018.4
14.2%
74,607.3
14.2%
85,056.5
14.2%
95,338.1
14.2%
105,034.3
14.2%
113,702.6
14.2%
120,905.8
14.2%
126,246.9
14.2%
129,403.1
14.2%
% of FCFF used in calculation
77.3%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
100.0%
Discount period
0.50
1.50
2.50
3.50
4.50
5.50
6.50
7.50
8.50
9.50
Discount factor
0.96
0.88
0.81
0.74
0.68
0.62
0.57
0.53
0.48
0.44
Discounted FCFF (DFCFF)
40,846.8
53,886.6
54,905.9
55,280.5
57,848.9
59,518.4
60,188.4
59,806.6
58,374.5
55,949.2

GOOG DCF Value

DCF Value Calculation

as of Mar 24, 2025
Sum of DFCFF
% share of EV
556.6B
38.5%
Terminal Value (TV)
2,008.2B
Discounted TV
% share of EV
890.0B
61.5%
Total Debt
22.6B
1,519.7B
Shares outstanding
12.1B
FX rate
1.0
25.8% overvalued

Equity Value Bridge

GOOG Earnings Power Value and Enterprise Value

Annual
LTM
Enterprise Value Breakdown
EPV and MIVoG as % of EV

GOOG Reverse DCF

Implied FCF growth
Implied Revenue growth

Reverse DCF Assumptions and Outputs

as of Dec 31, 2024
Long-Term growth rate
2.5%
FX rate
1.0
Last share price
190.2
Implied FCF growth 1-10Y
11.6%

Implied Free Cash Flow growth vs Historical average vs Industry growth

Competing with GOOG Intrinsic Value

Overview
Ratings
Intrinsic Value
Valuation
Growth
Profitability
Health
Capital allocation
Momentum
Earnings
Dividends
Company name
Market Cap
Enterprise Value
Intrinsic Value
DCF Value
Relative value
Ben Graham Revised fair value
Peter Lynch fair value
Earnings Power Value (EPV), % of EV
Market-Implied Value of Growth (MIVoG), % of EV
Reverse DCF (implied FCF growth)
Reverse DCF (implied Revenue growth)
$2,049.2B
$1,979.2B
$156.5
7.9% overvalued
$126.0
26.0% overvalued
$186.9
10.0% undervalued
$124.4
26.8% overvalued
$108.4
36.2% overvalued
45.1%
54.9%
11.6%
13.2%
$1,567.1B
$1,538.4B
$434.4
29.8% overvalued
$363.5
41.0% overvalued
$505.3
18.3% overvalued
$199.5
67.7% overvalued
$206.2
66.7% overvalued
41.8%
58.2%
11.3%
11.2%
$125.1B
$119.2B
$183.0
69.7% overvalued
$82.8
86.0% overvalued
$283.1
53.2% overvalued
$493.5
18.4% overvalued
$349.0
42.3% overvalued
12.1%
87.9%
19.0%
22.0%
$83.0B
$78.2B
$107.7
45.9% overvalued
N/A
$107.7
45.9% overvalued
$162.0
18.6% overvalued
$74.3
62.7% overvalued
(0.4%)
100.4%
19.3%
18.9%
$33.3B
$26.6B
$365.8
281.6% undervalued
$20.7
78.0% overvalued
$711.0
641.6% undervalued
$697.3
627.4% undervalued
$1,775.6
1,752.1% undervalued
173.6%
(73.6%)
(4.8%)
(8.8%)
$24.9B
$23.1B
$39.2
68.6% overvalued
N/A
$39.2
68.6% overvalued
$381.5
205.3% undervalued
N/A
(21.9%)
121.9%
34.9%
43.4%
$23.0B
$20.6B
$18.7
44.9% overvalued
$6.4
81.0% overvalued
$31.1
8.8% overvalued
Negative
276.0% overvalued
Negative
180.5% overvalued
73.1%
26.9%
5.9%
5.9%
$22.0B
$18.8B
$15.4
8.3% undervalued
$13.7
3.0% overvalued
$17.0
19.9% undervalued
$19.3
35.9% undervalued
$16.4
15.9% undervalued
206.7%
(106.7%)
(2.8%)
(2.1%)
$17.2B
$16.0B
$93.7
27.2% undervalued
$150.1
104.0% undervalued
$37.2
49.5% overvalued
$185.9
152.4% undervalued
N/A
(11.7%)
111.7%
24.8%
28.1%
$16.3B
$14.0B
$141.3
32.9% undervalued
N/A
$141.3
32.9% undervalued
$413.9
289.5% undervalued
N/A
(3.3%)
103.3%
11.6%
9.5%
$16.0B
$16.9B
$16.4
71.5% undervalued
N/A
$16.4
71.5% undervalued
$4.9
48.2% overvalued
$13.3
39.4% undervalued
(59.2%)
159.2%
19.0%
26.1%

Intrinsic Valuation Tools

Wondering how to calculate intrinsic value of a stock? Use our intrinsic value tools to simplify complex valuation concepts and save time.

FAQ

What is the DCF value of Alphabet Inc. (GOOG)?

As of today, DCF Value of Alphabet Inc. is $126.0, which is overvalued by 25.8%, compared to the current market share price of $169.9

How was the DCF Value calculated?

Step 1: Calculating Intrinsic Enterprise Value DCF Value was calculated by estimating Alphabet Inc. future free cash flow and then discounting it, using a chosen discount rate to determine Intrinsic Enterprise Value of $0.0B Step 2: Balance Sheet Adjustments Intrinsic Equity Value is calculated by subtracting Balance Sheet items (Cash & Equivalents, Short-term investments and Total Debt) from previously calculated Intrinsic Enterprise Value. This Intrinsic Equity Value is then divided by the total number of outstanding shares of 0 to determine DCF Value of $126.0

What is the Relative value of Alphabet Inc. (GOOG)?

As of today, Relative Value of Alphabet Inc. is $186.9, which is undervalued by 10.0%, compared to the current market share price of $169.9

How was the Relative Value calculated?

Relative Value was calculated by applying various valuation multiples (EV/Revenue, EV/EBITDA, P/E etc.) to Alphabet Inc. financials to determine Relative Value of $186.9

What is Alphabet Inc. (GOOG) discount rate?

Alphabet Inc. current Cost of Equity is 9.1%, while its WACC stands at 8.9%. Cost of Equity is used to value equity, while discounting free cash flow to equity holders (such as Net Income or Free Cash Flow to Equity). Weighted Average Cost of Capital (WACC) is used to value the entire firm, while discounting cash flows available to both debt and equity holders (NOPAT or Free Cash Flow to the Firm)

How is Cost of Equity for Alphabet Inc. (GOOG) calculated?

The Cost of Equity represents the return a company must offer investors to compensate for the risk of investing in its stock. It's calculated using the Capital Asset Pricing Model (CAPM), which combines the risk-free rate, the stock's beta, and the equity risk premium (ERP). This model considers the inherent risk of investing in the stock compared to a risk-free investment and the market's overall risk. Cost of Equity = Risk-Free Rate + Beta x Effective Risk Premium (ERP) 9.1% = 4.3% + 1.0 x 4.6%

How is WACC for Alphabet Inc. (GOOG) calculated?

WACC, or Weighted Average Cost of Capital, is a calculation that reflects the average rate of return a company is expected to pay its security holders to finance its assets. It is a critical measure in financial analysis for valuing a company's entire operations. The WACC formula combines the costs of equity and debt, weighted by their respective proportions in the company's capital structure. WACC = Cost of Equity x Equity Weight in Total Capital + Cost of Debt x (1 - Effective Tax Rate) Debt Weight in Total Capital 8.9% = 9.1% x 1.2% + 0.0% x (1 - 17.7%) x 98.8%