Financial services company Jeffries is loving themselves some Google right now, according to Jefferies Technology analysts Brent Thill. With all the focus on shifting towards value, the firm sees the search engine giant as such relative to its potential—something to look at when considering exchange-traded funds (ETFs) with the heaviest exposure to Google.
“We remain positive on GOOGL on attractive valuation and a portfolio of assets waiting to be unlocked,” said Thill.
The performance indicators have something to say as well—the stock is up 12% while the S&P 500 is up 17%. Its FAANG peers like Facebook and Amazon have also ousted Google in terms of performance, and the stock is trading below its 10-year average.
That said, it offers investors a value-oriented play as its market cap is $820 billion and the stock is offered at a 30% discount relative to the real total value of the company. Nonetheless, Thill senses an opportunity, particularly if Google can catch up to its competitors when it comes to implementing cloud computing technology.
Google is already shoring up its workforce to prepare for big moves ahead.
“We have tripled our public sector sales force this year, just as an example, because of the demand we see from our public sector customers,” said Thomas Kurian, who runs Google’s cloud business. “We are very committed to working with the U.S. government. And we have many, many projects and many people at Google working with them.”
The search engine giant, however, could face some challenges when it comes to its latest antitrust probe. Per a Business Insider report, “A coalition of state attorneys general from 49 states and Washington, D.C. announced the probe on Monday and said it will focus on whether Google has used anti-competitive practices in its ads business. The announcement is the most recent advancement of antitrust scrutiny on large US tech companies”
This could put further down pressure on the stock price, but for investors sensing an opportunity to buy the dip can look at ETFs with the heaviest exposure to Google:
| Ticker | ETF | Weighting |
| XLC | Communication Services Select Sector SPDR Fund | 12.07% |
| VOX | Vanguard Communication Services ETF | 11.37% |
| FCOM | Fidelity MSCI Communication Services Index ETF | 11.35% |
| DUSA | Davis Select U.S. Equity ETF | 10.08% |
| IXP | iShares Global Telecom ETF | 9.99% |
| TTTN | TigerShares China-U.S. Internet Titans ETF | 8.18% |
| PNQI | Invesco NASDAQ Internet ETF | 8.17% |
| TMFC | Motley Fool 100 Index ETF | 7.69% |
| IVFGC | Ivy Focused Growth NextShares | 6.97% |
| DWLD | Davis Select Worldwide ETF | 6.64% |
For more market trends, visit ETF Trends.
