Cowen reiterates Buy rating on Alphabet stock ahead of Q2 earnings

Published 09/07/2025, 16:32
Cowen reiterates Buy rating on Alphabet stock ahead of Q2 earnings

Investing.com - TD Cowen maintained its Buy rating and $195.00 price target on Alphabet (NASDAQ:GOOG) ahead of the company’s second-quarter 2025 earnings report, due in 20 days. With a market cap of $2.17 trillion and analyst targets ranging from $185 to $237, InvestingPro analysis suggests the stock is currently undervalued.

The firm expects solid growth in Search and YouTube amid resilient consumer behavior, despite ongoing tariff uncertainties. TD Cowen’s digital advertising expert call on July 2 indicated that Google (NASDAQ:GOOGL) Search strength has continued into the summer months. This aligns with the company’s impressive 13% year-over-year revenue growth and strong financial health score of "GREAT" according to InvestingPro metrics.

TD Cowen forecasts second-quarter net revenue growth of 12.7% year-over-year, which is 5.4% above consensus estimates. The firm’s operating income and EPS estimates are also above consensus by 5.5% and 4.6%, respectively.

The research note highlighted interest in updates on Alphabet’s generative AI efforts, including the recent AI Mode rollout that combines traditional search with chatbot search capabilities.

Alphabet is integrating artificial intelligence features across its core search business as the company continues to compete in the rapidly evolving AI landscape.

In other recent news, Google has announced a significant development in the energy sector by signing a deal to purchase 200 megawatts of power from Commonwealth Fusion Systems’ ARC project in Virginia. This marks the first direct corporate power purchase agreement involving fusion energy technology. Additionally, Google is increasing its investment in Commonwealth Fusion Systems, although specific financial details were not disclosed. In another development, Google has launched initiatives to explore the use of artificial intelligence in mental health treatment, partnering with organizations like Grand Challenges Canada and Wellcome Trust. These initiatives aim to improve mental health care access and develop new therapeutic interventions. Furthermore, Google has proposed changes to its search results amid ongoing antitrust scrutiny from the European Union, with discussions scheduled in Brussels. In advertising news, Chinese shopping site Temu has resumed its digital ad campaigns on Google after a pause, following a new trade deal announcement between the U.S. and China. Meanwhile, Perplexity’s launch of an AI-powered web browser, "Comet," presents a potential competitive challenge to Google’s search dominance, though investors appear confident in Google’s market position.

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