Here's what every major analyst is predicting for Alphabet's earnings report after the bell

Published Mon, Feb 3 202011:07 AM EST

(This story is for CNBC PRO subscribers only.) Wall Street analysts are hoping shares of Alphabet continue their momentum when the internet giant reports its fourth-quarter earnings report on Monday after the bell. The stock is up 7% since January 1 and 11% since the company's previous report in October which missed estimates disappointing investors. Analysts are hoping this time around will be different. This will be CEO Sundar Pichai's first earnings report since officially taking over the CEO role from Google co-founder and former Alphabet CEO Larry Page in December. Many analysts say the management change has the potential to lead to better disclosure and improved expense discipline. In addition analysts are looking for increased revenue growth, signs of improving profitability, and updates on regulatory issues, YouTube, and the cloud business. Here's what analysts expect for Alphabet's earnings report: Despite the regulatory distractions, Wells Fargo believes the company will continue to lean on its powerful search engine to lead the way going forward. "Antitrust, Privacy and Section 230 are topical in the news, but the core search business has continued runway ahead, with increasingly material revenue contribution from YouTube and programmatic advertising," they said. The company has been under intense pressure from regulators over Section 230 of the Communications Decency Act which says online platforms may be exempt from legal liability for the material that users post. However, the firm also thinks the recent management changes leave plenty of upside for the stock. "New leadership and improved go-to-market execution should drive share gains," the firm said. The feeling was similar from Deutsche Bank. "The key medium term focal point this quarter will be any signs of a more shareholder friendly approach under the new leadership with Sundar Pichai taking over the Alphabet CEO job," they said. No matter what happens though, Wedbush expects the company to keep spending without sacrificing profit which has traditionally been a trouble spot for shareholders. "We are confident that Alphabet will continue to grow its top line and that it can manage its operating expenses to generate ever-increasing profitability," analyst Michael Pachter said. Another firm urged clients to be cautious and said that a slowdown in Amazon and Facebook's ad business could be an ominous sign for Alphabet. "While we see no reason to lower our forecast, in light of the deceleration demonstrated by FB and AMZN advertising, we have reduced confidence in a material Properties revenue beat from GOOGL," Evercore ISI said. Still the analyst wasn't quite ready to change his outperform rating on the stock. "Despite our hesitation into Monday's results, GOOGL should remain a core holding for investors that don't trade quarters." RBC- Outperform rating "Based on intra-quarter data points and our model sensitivity analysis, we believe Street estimates for Q4 are reasonable, with equal chance of downside vs. upside variance on Revenue and Operating Income, but a slightly greater chance of downside on EPS." BMO- Market Perform rating "Going into the quarter, we think expectations are very high, and that even strong results could ultimately disappoint (as FB did on Wednesday). We continue to expect deceleration beginning in 4Q19, as we don't see new ad load (more Promoted Pins on Maps, Discovery feed, YouTube masthead on TV app, etc.) providing enough upside to offset law of large numbers." Goldman Sachs- Buy rating "Our advertiser checks point to a solid quarter with relatively steady growth in search and YouTube. ... All in, we continue to view Alphabet as one of the best-positioned digital ad companies, and see non-advertising revenue streams like Google Cloud becoming a more central part of the thesis over time. ... We also expect investors to focus on expense growth." Deutsche Bank- Buy rating "The key medium term focal point this quarter will be any signs of a more shareholder friendly approach under the new leadership with Sundar Pichai taking over the Alphabet CEO job. We look for (1) any improvements in disclosure, either explicitly in reported results or on the call, (2) the pace of buyback activity, particularly after the new $25B authorization in 2Q, and (3) any forward outlook commentary regarding topline or expense controls. Given Mr. Pichai's new comp package has about 38% of his bonus contingent on performance conditions tied to GOOG performance relative to the S & P 100, we think this better aligns interests and shows the board is focused on the stock price. Bank of America- Buy rating "Google has had improved stock performance (stock up 23% trailing 6 months vs SPX up 12%) on more confidence that ad growth is sustainable, growing optimism on the Cloud business, and view that management will be more stock friendly with CEO change. US checks suggest stable ad growth in 4Q, and we expect revenues close to Street at $38.4bn with stable ex-FX Website growth." SunTrust- Buy rating "We remain positive on GOOGL heading into 4Q earnings, as conversations with marketers and third party data about consumer spend/confidence support healthy paid Search trends, despite a shortened holiday season. Consensus revenue growth of ~20.5% Y/Y implies slight deceleration from 3Q19's 21.5%; with a product mix shift and investments driving flattish Y/Y profit margins. Breakthroughs in AI/ML should drive growth further over time. Regulatory risks remain real but with no material impact to operations short term." Barclays- Overweight rating "Fundamentals solid, cautiously optimistic here. We are upbeat on GOOGL into the print and would selectively add to positions, despite the very frothy sentiment backdrop. One big caveat is that ahead of the senior equity refresh, GOOGL shares have tended to fall sharply on the print more than 50% of the time over the past decade, typically on opex spikes, which are harder for consensus to predict. 4Q revenue checks remain solid and beyond the print GOOGL has arguably the easiest path for additional upside in 1Q, hence we think the momentum over the past few months can continue." Credit Suisse- Outperform rating "Our investment thesis for GOOGL shares remains unchanged and we maintain our Outperform rating based on the following factors: 1) ongoing monetization improvements in Search through product updates, 2) larger-than expected contribution from Google's larger non-Search businesses, 3) optionality for value creation from new monetization initiatives such as Maps and Discover as well as the eventual commercialization of Google's Other Bets (Waymo, Life Sciences)." Wells Fargo- Overweight rating "Antitrust, Privacy and Section 230 are topical in the news, but the core search business has continued runway ahead, with increasingly material revenue contribution from YouTube and programmatic advertising. Google cloud platform represents the most technologically advanced public cloud with the most compelling AI/ ML offerings. New leadership and improved go-to-market execution should drive share gains. Programmatic expertise + YouTube TV position GOOGL to win in the emerging CTV ad market. ... We view shares as attractive given solid ad revenue growth, improving investment discipline and an array of "call options" including GCP/machine learning, connected TV, devices and Waymo." Evercore ISI- Outperform rating "If the deceleration that characterized FB and AMZN's ad business in the 4Q is any indication, investors looking for a big revenue beat may be let down. As it stands, we think the Street is too optimistic about margin trends. Outside of these tactical considerations, our bullish view of GOOGL remains unchanged. ... Despite our hesitation into Monday's results, GOOGL should remain a core holding for investors that don't trade quarters. ... While we see no reason to lower our forecast, in light of the deceleration demonstrated by FB and AMZN advertising, we have reduced confidence in a material Properties revenue beat from GOOGL" Canaccord- Buy rating "We forecast continued stable advertising revenue growth at ~17% in Q4,while investors will be looking for further discussion of the company's decision to phase out 3P cookies, along with updates on new ad products. Other areas of interest include Google's acquisition of Fitbit and progress with Cloud and Waymo." KeyBanc- Overweight rating "We have moderate concern that a slowdown in ad volume growth at YouTube could negatively impact Sites ad revenue growth through 2020. However, we believe ad pricing, Maps, shopping, and YouTube TV should offset much of this and allow Alphabet to continue generating revenue growth that we view as undervalued at current levels." Stifel- Buy rating "We upgraded shares of Alphabet to Buy from Hold in December given attractive valuation and a healthy runway for durable earnings growth. ... Alphabet is well positioned to capture incremental share gains in advertising dollars, and the company's product ecosystem continues to support monetization and long-term revenue / EPS growth, in our view." Wedbush- Outperform rating "We believe that an OUTPERFORM rating is warranted given valuation upside and an unrivalled collection of high-profile and omnipresent core products and platforms. ... We are confident that Alphabet will continue to grow its top line and that it can manage its operating expenses to generate ever-increasing profitability." JPMorgan- Overweight rating "We believe the headwinds that may have muted FB's 4Q growth a bit—a combination of regulatory, platform, & product-driven—would likely impact GOOGL less, though GOOGL could have more exposure to the shorter holiday season. Investor sentiment around GOOGL has improved, w/shares up 11% since 3Q earnings vs. the SPX +6%. However, we believe stronger sentiment is attributable to the potential for increasingly shareholder friendly actions more than on pure fundamentals, though the Street is recognizing Cloud gains."

Google CEO Sundar Pichai speaks during signing ceremony committing Google to help expand information technology education at El Centro College in Dallas, Texas, October 3, 2019.

Brandon Wade | Reuters

(This story is for CNBC PRO subscribers only.)

Wall Street analysts are hoping shares of Alphabet continue their momentum when the internet giant reports its fourth-quarter earnings report on Monday after the bell.

The stock is up 7% since January 1 and 11% since the company's previous report in October which missed estimates disappointing investors.

Analysts are hoping this time around will be different.

This will be CEO Sundar Pichai's first earnings report since officially taking over the CEO role from Google co-founder and former Alphabet CEO Larry Page in December. Many analysts say the management change has the potential to lead to better disclosure and improved expense discipline.

In addition analysts are looking for increased revenue growth, signs of improving profitability, and updates on regulatory issues, YouTube, and the cloud business.

Here's what analysts expect for Alphabet's earnings report: