5 Best Media and Entertainment Stocks to Buy Now

1- Alphabet Inc (GOOGL)

Number of Hedge Fund Holders: 205

For Q2 2022, Alphabet Inc. (NASDAQ:GOOG) had an EPS of $1.21, missing estimates by $0.08, and reported actual revenue of $69.7 billion, missing estimates by $112 million. We believe GOOGL is cheap based on sum of the parts valuation as its cloud business is losing nearly a billion dollars each quarter and dragging down the earnings of the company. The same thing can be said about its other bets which is losing nearly $2 billion per quarter.

In its Q2 2022 investor letter, Wedgewood Partners mentioned Alphabet Inc. (NASDAQ:GOOG) and explained its insights for the company. Here is what the fund said:

“Alphabet grew its core search revenues +24% on a +30% year-ago comparison. Despite this stellar top-line performance, shares sold off as the market began to discount fears of a recession. However, the stock has outperformed relative to other holdings as core Google Search has been less affected by disruptions related to Apple’s privacy initiatives. Alphabet’s Cloud segment is generating revenue at a $24 billion run rate but is still running at a loss. We think this business can generate much better margins at some point. In the meantime, the Company has 4% to 5% of shares authorized for repurchase which is an attractive use of capital as the stock trades for about just 18X 2023 consensus estimates.”

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