GOOGL Traders Buy Dip as Alphabet Raises CapEx
GOOGL stock rose 1.2% in premarket trading on Friday after suffering its worst single-day drop on Thursday following its quarterly report. The decline came after Alphabet said it would raise this year's capital expenditure by an additional $15 billion, overshadowing an otherwise strong earnings report.
The majority of retail traders polled on Stocktwits said they are buying the dip in GOOGL stock, with 57% accumulating shares on the drop. Eighteen percent of respondents said they are not investing, while 14% said they are watching the move and 11% are holding onto their positions.
Alphabet's cloud peers, Microsoft and Amazon, will report quarterly results on July 29 and 30, respectively, offering investors a clearer read on Big Tech capital spending and cloud demand. Alphabet reported better-than-expected second-quarter sales and profit, as well as a record 82% growth in its cloud unit.
GOOGL's CapEx update shows that the company is investing heavily in capacity to meet growing demand, with CapEx doubling from a year ago to $44.92 billion in the June quarter. The full-year CapEx guidance range has been updated to $195 billion to $205 billion, up from the previous estimate of $180 billion to $190 billion.