Alphabet Inc. (NASDAQ:GOOG)

The valuation ratios exhibit varied trends over the observed period, spanning from March 31, 2022, to December 31, 2025. Generally, the ratios demonstrate increased volatility in the later periods of the analysis, particularly from March 31, 2024, onwards. An overall upward trend is noticeable in most ratios towards the end of the period, suggesting a potential re-evaluation of the company’s worth by the market.

Price to Earnings (P/E) Ratio

The P/E ratio fluctuated between approximately 18 and 27 over the analyzed timeframe. A slight decreasing trend was observed from March 31, 2022, to September 30, 2022, followed by an increase through December 31, 2023. A notable decline to 17.91 was recorded on March 31, 2025, before rising again to 30.33 by December 31, 2025. This suggests changing investor sentiment regarding earnings expectations.

Price to Operating Profit (P/OP) Ratio

Similar to the P/E ratio, the P/OP ratio showed variability, ranging from approximately 15 to 31. The ratio generally trended downwards from March 31, 2022, to September 30, 2022, then increased through December 31, 2023. The most significant increase occurred between September 30, 2025, and December 31, 2025, moving from 27.42 to 31.06, indicating a potentially stronger relationship between price and operating profitability in the most recent quarter.

Price to Sales (P/S) Ratio

The P/S ratio demonstrated a more consistent upward trend, particularly after June 30, 2022. Starting at 5.60 in March 2022, it increased to 9.95 by December 2025. This indicates investors were willing to pay more for each dollar of revenue generated by the company over time. The increase was particularly pronounced in the final year of the period.

Price to Book Value (P/BV) Ratio

The P/BV ratio exhibited a pattern of fluctuation, generally increasing over the period. It began at 5.96 in March 2022 and rose to 9.65 by December 2025. A dip was observed in the earlier quarters, but the ratio generally trended upwards, suggesting an increasing market valuation relative to the company’s net asset value. The most substantial increase occurred between March 31, 2024, and December 31, 2025.

In conclusion, the observed valuation ratios suggest a dynamic market perception of the company. While fluctuations are present, a general trend of increasing valuation multiples towards the end of the analyzed period is evident, potentially reflecting positive market expectations or a shift in investor confidence.

The price-to-earnings (P/E) ratio exhibited fluctuations over the observed period, generally trending upwards with intermittent declines. Initial values in the first quarter of 2022 were approximately 20.32, increasing to a peak of 26.82 in the second quarter of 2023. Subsequently, the ratio experienced a decrease before rising again to reach 30.33 by the final quarter of 2025. This suggests a changing investor sentiment regarding the company’s valuation relative to its earnings.

Initial Period (Mar 31, 2022 – Dec 31, 2022)

The P/E ratio demonstrated relative stability, fluctuating between 18.32 and 22.47. This period suggests a consistent, albeit moderate, valuation by the market. A slight increase is observed towards the end of the period.

Ascending Trend (Mar 31, 2023 – Jun 30, 2023)

A notable increase in the P/E ratio occurred, rising from 22.64 to 26.82. This coincided with an increase in both share price and earnings per share, but the P/E increase indicates investors were willing to pay a higher premium for each dollar of earnings.

Mid-Period Volatility (Sep 30, 2023 – Mar 31, 2024)

The P/E ratio experienced a period of volatility, decreasing to 23.76 before rising to 26.05. This suggests a period of reassessment by investors, potentially influenced by broader market conditions or company-specific news. Earnings per share continued to increase during this period.

Recent Trend (Apr 01, 2024 – Dec 31, 2025)

The P/E ratio initially decreased to 17.91 in the first quarter of 2025, potentially reflecting a correction after previous gains. However, it then exhibited a strong upward trend, culminating in a value of 30.33 by the end of 2025. This final increase occurred alongside continued growth in earnings per share, but also a more substantial increase in share price, indicating growing investor optimism.

Overall, the P/E ratio demonstrates a general upward trajectory over the analyzed timeframe, punctuated by periods of consolidation and correction. The increasing ratio towards the end of the period suggests a growing market confidence in the company’s future earnings potential, or potentially, a period of market exuberance.

The Price to Operating Profit (P/OP) ratio for the analyzed period demonstrates considerable fluctuation. Initially, the ratio exhibited a decreasing trend from March 31, 2022, to September 30, 2022, followed by a period of relative stability and then an upward trajectory. More recently, the ratio has shown increased volatility.

Initial Trend (Mar 31, 2022 – Sep 30, 2022)

The P/OP ratio decreased from 18.39 to 15.62 over this period. This suggests a relative decline in the market’s valuation of each dollar of operating profit generated by the company, or potentially, an increase in investor skepticism during this timeframe. The decline was not monotonic, with a slight increase observed between June 30, 2022, and September 30, 2022.

Stabilization and Increase (Dec 31, 2022 – Sep 30, 2023)

From December 31, 2022, to September 30, 2023, the P/OP ratio generally increased, moving from 20.92 to 20.13, then to 21.93. This indicates a renewed investor confidence or a reassessment of the company’s future earnings potential. The ratio remained relatively stable around the 20-22 range during this period.

Recent Volatility (Dec 31, 2023 – Dec 31, 2025)

The period from December 31, 2023, through December 31, 2025, is characterized by significant volatility. The P/OP ratio increased substantially, reaching 31.06 by December 31, 2025, from 20.92. This increase coincides with a substantial increase in share price and operating profit per share. However, there was a notable dip to 16.92 in March 2025, suggesting a temporary market correction or shift in sentiment. The ratio then rebounded strongly.

Overall, the P/OP ratio has demonstrated a long-term upward trend, particularly in the most recent quarters. This suggests that investors are willing to pay a higher premium for each dollar of operating profit, potentially reflecting increased optimism about the company’s future growth prospects. However, the recent volatility warrants continued monitoring to assess the sustainability of this trend.

Correlation with Share Price and Operating Profit

The P/OP ratio’s movements are strongly correlated with both the share price and operating profit per share. Increases in operating profit per share generally contribute to a higher P/OP ratio, while increases in the share price amplify this effect. The dip in March 2025 suggests that a decline in share price can significantly impact the ratio, even with continued growth in operating profit.

The price-to-sales (P/S) ratio exhibited fluctuating behavior over the observed period, spanning from March 31, 2022, to December 31, 2025. Initial values indicated a gradual decline followed by a period of increase, culminating in a peak before a subsequent decrease and final rise.

Initial Decline (Mar 31, 2022 – Sep 30, 2022)

The P/S ratio began at 5.60 and decreased to 4.35 over the first three quarters of the period. This suggests a relative decrease in investor willingness to pay for each dollar of sales during this timeframe, potentially reflecting broader market conditions or company-specific concerns.

Recovery and Growth (Dec 31, 2022 – Dec 31, 2023)

From December 31, 2022, through December 31, 2023, the P/S ratio demonstrated a recovery, increasing from 4.76 to 6.73. This upward trajectory indicates growing investor confidence and a higher valuation placed on the company’s sales.

Mid-Period Fluctuation (Mar 31, 2024 – Sep 30, 2025)

The ratio experienced a slight decrease to 5.53 by March 31, 2024, before rising again to 6.29 by June 30, 2024. A more substantial increase followed, reaching 8.82 by September 30, 2025, and peaking at 9.95 by December 31, 2025. This suggests a renewed period of positive investor sentiment and potentially expectations of future sales growth.

Sales per Share Trend

Sales per share consistently increased throughout the period, moving from 20.53 to 33.30. This consistent growth in sales per share likely contributed to the fluctuations observed in the P/S ratio, as investors reacted to the company’s revenue generation capabilities.

Overall Trend

Despite interim fluctuations, the P/S ratio demonstrated an overall increasing trend from 5.60 in March 2022 to 9.95 in December 2025. This indicates that, over the long term, the market has been willing to pay a higher premium for each dollar of the company’s sales.

The observed changes in the P/S ratio should be considered in conjunction with other financial metrics and qualitative factors to gain a comprehensive understanding of the company’s valuation.

The price-to-book value (P/BV) ratio exhibited fluctuating behavior over the observed period, spanning from March 31, 2022, to December 31, 2025. Initially, the ratio demonstrated a declining trend through the first three quarters of 2022, followed by a modest increase by year-end. This pattern continued into the first half of 2023, with a notable rise in the ratio, before stabilizing and experiencing slight fluctuations through the remainder of the year. A more pronounced upward trend became evident in 2024, peaking in the fourth quarter, and continued into 2025, reaching its highest point at the end of the period.

Initial Decline (Mar 31, 2022 – Sep 30, 2022)

The P/BV ratio decreased from 5.96 to 4.84 over this period. This suggests a relative decrease in investor confidence regarding the company’s net asset value, or potentially a correction after prior gains. The share price experienced a more significant decline than the book value per share during this timeframe, contributing to the lower ratio.

Recovery and Stabilization (Oct 31, 2022 – Dec 31, 2023)

Following the decline, the P/BV ratio recovered to 6.22 by December 31, 2022, and then fluctuated between approximately 5.80 and 6.22 throughout 2023. This indicates a period of relative stability, with the market’s valuation of the company’s book value remaining consistent. Both share price and book value per share increased during this period, but at varying rates.

Significant Increase (Jan 01, 2024 – Dec 31, 2025)

The P/BV ratio increased substantially, rising from 7.33 in March 2024 to 9.65 by December 2025. This substantial increase suggests growing investor optimism regarding the company’s ability to generate earnings from its net assets. The share price experienced a more rapid increase than the book value per share, driving the ratio higher. The ratio’s peak at the end of the period indicates a potentially elevated valuation relative to the company’s book value.

Throughout the observed period, the P/BV ratio remained above 4.84, indicating that the market consistently valued the company at more than its book value. The increasing trend in the latter portion of the period suggests a strengthening market perception of the company’s future prospects and efficient utilization of its assets.