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Google soars more than 15% on Wall Street after announcing the first dividend in its history

Google soars more than 15% on Wall Street after announcing the first dividend in its history

Alphabet announced not only the start of a cash dividend program, but also the authorization to buy back up to an additional $70 billion of its shares.

Photo: Franceinfo

Alphabet, parent company of Google, is regaining its shine. After facing challenging quarters, the parent company surprised the market by exceeding all expectations with its financial results and announcing its first dividend in the company’s history.

This leads bigtech shares to rise 15.3% shortly after the market opened in the United States. Thus, in recent days Google’s paper has recorded 12.4% gains, which climbed to 15.3% in the last month.

This move toward paying dividends signals a shift in the technology landscape, according to Russ Mold, chief investment officer at AJ Bell. Companies like Alphabet and Meta, which recently joined the ranks of dividend payers, could attract a broader investing public.

Google: how it went in the first part of the year

Alphabet’s numbers have been impressive, with a 57.2% increase in its net profit and a 15% growth in revenue during the first quarter of 2024. Google Cloud has stood out with a growth of 28%, as has YouTube. Additionally, Google’s advertising revenue exceeded expectations.

Bankinter values ​​these results positively, considering Alphabet as an attractive investment in the medium term.

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Reuters

During the presentation of the results, Alphabet announced not only the start of a cash dividend program, but also the authorization to buy back up to an additional $70 billion of its shares. This measure has been well received by investors.

According to AJ Bell, big tech companies have accumulated so much cash that they can now reward shareholders, as well as reinvest in the business. Although Alphabet and Meta’s dividend yields are modest, the growth potential of these dividends could be attractive to investors looking for passive income.

Source: Ambito

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