Intel stock extends gains after report of possible U.S. government stake
On Friday, Rosenblatt Securities adjusted its outlook on Alphabet Inc. (NASDAQ:GOOGL), reducing the tech giant’s price target from $205 to $189 while maintaining a Neutral rating on the shares. The revision follows Alphabet’s first-quarter earnings report for 2025, which was described as solid by the firm’s analysts. The company, currently valued at $1.95 trillion, has maintained strong revenue growth of nearly 14% over the last twelve months, trading at a P/E ratio of 19.7x.
The adjustment in the price target reflects concerns about the near-term increase in macroeconomic risks that could potentially slow down the company’s advertising growth trajectory. Rosenblatt analysts also highlighted longer-term concerns regarding antitrust and competitive risks, which have been brought into focus due to recent significant legal setbacks for Alphabet. According to InvestingPro data, 10 analysts have recently revised their earnings expectations downward for the upcoming period, suggesting growing caution among market observers. For deeper insights into Alphabet’s valuation and prospects, investors can access comprehensive Pro Research Reports covering 1,400+ top stocks on InvestingPro.
In a statement, Rosenblatt analysts remarked on the financial performance, "We maintain a NEUTRAL rating on Alphabet, and tweak down our price target $16 to $189, after a 1Q25 earnings report that was solid." This commentary underscores the firm’s stance on Alphabet’s stock, suggesting a cautious approach despite the company’s strong earnings.
The concerns about Alphabet’s future performance stem from broader market conditions and specific legal challenges. The analysts pointed out that while the earnings were robust, the potential for heightened macro risks in the near term could dampen the advertising revenue, which is a key income source for the company.
The report also signals that the tech company may face headwinds due to antitrust and competition issues. These challenges are not new to Alphabet, but Rosenblatt’s mention of "a pair of recent major losses" indicates that the company’s legal troubles could have a tangible impact on its business operations and market position.
In summary, despite Alphabet’s solid earnings in the first quarter of 2025, Rosenblatt Securities has expressed concerns about external factors that could affect its stock performance. The firm’s decision to lower the price target is based on the anticipation of macroeconomic risks and ongoing legal challenges that Alphabet may encounter. Nevertheless, InvestingPro analysis indicates that Alphabet maintains excellent financial health with a "GREAT" overall score, holding more cash than debt on its balance sheet. The stock currently appears slightly undervalued according to InvestingPro’s Fair Value model, with 12 additional exclusive ProTips available to subscribers.
In other recent news, Alphabet Inc. reported first-quarter results that exceeded expectations, driven primarily by its robust search advertising business. The company’s advertising revenue, accounting for nearly three-quarters of its total income, rose by 8.5% to $66.89 billion, surpassing analysts’ estimates of a 7.7% increase. Citi analysts responded by raising Alphabet’s stock price target to $200, citing the company’s strong performance in search revenue and advancements in artificial intelligence. They maintained a Buy rating, pointing to the resilience of Alphabet’s ad auction system and the monetization of YouTube. The company’s progress in AI, particularly AI Overviews and AI Mode in Search, was highlighted as a significant driver of future growth. Alphabet’s positive results also had a ripple effect on other tech giants, with firms like Meta Platforms (NASDAQ:META) and Amazon (NASDAQ:AMZN) seeing promising prospects in their own sectors. Analysts noted that the Waymo Austin rollout could be beneficial for Uber Technologies (NYSE:UBER). These developments underscore the interconnectedness of the tech sector and the potential for continued growth driven by innovation in AI and cloud services.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.