Bullish indicating open at $55-$60, IPO prices at $37
Investing.com - BofA Securities raised its price target on Alphabet (NASDAQ:GOOGL) to $210 from $200 while maintaining a Buy rating ahead of the company’s July 23 earnings report. This aligns with broader analyst sentiment, as InvestingPro data shows 11 analysts have recently revised their earnings estimates upward, with price targets ranging from $160 to $250.
The firm increased its revenue and earnings estimates above Street consensus based on search spending checks that showed stable growth in the second quarter, with improvement as the quarter progressed. BofA now expects second-quarter revenue of $81 billion and earnings per share of $2.21, compared to Street estimates of $79.5 billion and $2.15. This optimism is supported by Alphabet’s strong track record, with InvestingPro showing trailing twelve-month revenue of $359.7 billion and a robust 58.6% gross profit margin.
For Google Cloud, BofA projects revenue of $13.2 billion versus Street expectations of $13.1 billion, noting that Workspace price increases could drive upside. The firm estimates search revenue will increase 11% year-over-year, outpacing Street expectations of 9% growth.
Job data indicates Alphabet is growing its headcount, with job postings in the second quarter increasing 14% compared to March 2025. BofA expects second-quarter headcount to rise 1% quarter-over-quarter (adding approximately 1,600 employees) and 4% year-over-year, while noting that Alphabet’s voluntary employee buyout program suggests ongoing cost management efforts.
The price target increase reflects both higher estimates and a higher multiple of 19x compared to the previous 18x, with BofA citing appreciation among comparable companies. The firm expects core services operating margins to improve by 147 basis points year-over-year.
In other recent news, Alphabet’s Waymo has expanded its self-driving service in Austin, Texas, increasing its coverage from 37 square miles to 90 square miles. This expansion allows Waymo to serve additional neighborhoods and strengthens its position against competitors like Tesla (NASDAQ:TSLA). Meanwhile, KeyBanc Capital Markets has raised its price target for Alphabet to $215, expecting strong second-quarter results driven by Search, YouTube, and Cloud services. Cantor Fitzgerald also increased its price target to $196, anticipating Alphabet to exceed Wall Street estimates in revenue and earnings per share. Additionally, Needham has raised its price target to $210, citing Alphabet’s dominance in digital advertising and the strategic advantage of its AI capabilities. Google has introduced new AI features to its Search platform, including the Gemini 2.5 Pro model, enhancing the platform’s ability to handle complex queries. These updates are part of Alphabet’s broader efforts to leverage AI for business growth and operational efficiencies.
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