Bullish indicating open at $55-$60, IPO prices at $37
On Wednesday, BofA Securities maintained a Buy rating and a $185.00 price target for Alphabet Inc. (NASDAQ:GOOGL). Analysts at the firm observed that in March, the average daily web visits to Google remained stable month-over-month at approximately 2.7 billion, marking a slight 1% decrease year-over-year. Meanwhile, ChatGPT's web traffic increased by 6% month-over-month, reaching 152 million visits, which represents a significant 159% surge year-over-year. According to InvestingPro data, Alphabet's stock is currently trading near its 52-week low of $140.53, suggesting potential value opportunity given the company's strong 13.87% revenue growth over the last twelve months.
In the United States specifically, Google's traffic was consistent year-over-year at 537 million visits, while ChatGPT saw a notable 104% year-over-year increase to 23 million visits, accounting for 4% of Google's traffic. Bing experienced an 11% year-over-year decline to 11 million visits. Month-over-month changes in the U.S. showed a 1% decrease for Google, a 2% increase for ChatGPT, and an 8% increase for Gemini.
BofA Securities highlighted the competitive landscape in artificial intelligence, pointing out that OpenAI, the creator of ChatGPT, has amassed 20 million subscribers and 400 million users. This presents a potential brand deficit for Google's Gemini in the AI space. Nonetheless, analysts remain positive about Google's recent AI Overviews and its core valuation. They believe that new features such as AI mode and travel planning could lead to higher monetization and more advertising clicks from informational queries. InvestingPro analysis shows Alphabet maintains its position as a prominent player in the Interactive Media & Services industry, with an impressive EBITDA of $129.5 billion and robust profit margins of 58.2%.
The report also noted that Alphabet's stock is currently trading at roughly $147, which is approximately 16 times the firm's projected 2026 GAAP EPS. This valuation is considered low compared to the S&P 500 average of 18 times earnings. BofA's sum-of-the-parts valuation suggests that Alphabet's core business is valued at only 9 times its 2026 earnings.
Looking forward, BofA Securities pointed to upcoming events that could act as catalysts for Alphabet's stock. These include the Google Cloud Conference on April 9, 2025, the Search Remedy Trial scheduled for April 22, 2025, and the Google I/O Conference on May 20, 2025. For deeper insights into Alphabet's valuation and growth prospects, investors can access the comprehensive Pro Research Report, available exclusively on InvestingPro, which includes detailed analysis of the company's competitive position, financial health, and growth trajectory among 1,400+ top stocks.
In other recent news, Alphabet's Google Cloud Platform (GCP) has shown impressive growth, exceeding 40% year-over-year in the first quarter. Analysts at Cantor Fitzgerald maintain a Neutral rating on Alphabet, citing GCP's advancements in sectors like Healthcare and Travel. Wolfe Research has adjusted its price target for Alphabet to $190 from $210, while retaining an Outperform rating, noting that YouTube's performance remains strong and enterprise Cloud services trends are stable. Alphabet's advertising budgets for Search have shown slight decreases, but Wolfe Research considers the risk/reward balance for the stock to be favorable.
In other developments, Nvidia (NASDAQ:NVDA) led a rise in premarket trading among the Magnificent Seven stocks, with a 2.9% increase. Tesla (NASDAQ:TSLA), Amazon (NASDAQ:AMZN), and Meta (NASDAQ:META) also experienced gains, while Apple (NASDAQ:AAPL)'s shares have dropped significantly over the past three trading days. Additionally, Google's Deep Research feature is now available on the Gemini 2.5 Pro Experimental model, offering enhanced analytical capabilities for Gemini Advanced subscribers. This tool aims to improve research efficiency and provide users with insightful reports across multiple platforms.
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