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Investing.com - Scotiabank raised its price target on Alphabet (NASDAQ:GOOG) stock to $310.00 from $240.00 on Thursday, while maintaining a Sector Outperform rating. The stock, currently trading near its 52-week high of $256.70, has delivered an impressive 51.6% return over the past year.
The price target increase follows what Scotiabank described as a "clear recovery" in Alphabet’s core advertising business, with ad growth returning to double digits. The firm noted this improvement stemmed from both easier comparisons and genuine increases in advertiser spending. This recovery is reflected in Alphabet’s robust 13.1% revenue growth over the last twelve months, with the company generating $371.4 billion in revenue.InvestingPro analysis reveals that Alphabet maintains excellent financial health with a "GREAT" overall score, offering 15+ additional investment insights for subscribers.
YouTube’s performance was highlighted as particularly strong, with its short-form video feature "Shorts" approaching monetization parity with traditional YouTube videos on a per-hour basis in some markets. This development suggests the company has successfully addressed initial monetization challenges for the format.
Scotiabank also pointed to Alphabet’s new Ironwood TPU (3nm) chip, which showed significant improvements over the previous TPU v5p model, potentially helping narrow the efficiency gap with Nvidia.
The firm indicated that third-party data for Alphabet’s third quarter appears to be tracking in line with consensus expectations, while Google Cloud Platform (GCP) growth and margins are expected to meet investor expectations.
In other recent news, Google has unveiled significant developments across various sectors. The company introduced Veo 3.1, an upgraded version of its AI filmmaking tool, Flow, which now includes enhanced audio capabilities. This update aims to provide users with greater artistic control and has already facilitated the creation of over 275 million videos since its launch. In a breakthrough for cancer research, Google released the Cell2Sentence-Scale 27B model, part of the Gemma family, which has successfully identified a new pathway for cancer therapy development.
Google also announced plans to invest $15 billion to establish its first AI hub in India, located in Visakhapatnam, Andhra Pradesh, between 2026 and 2030. This investment will include data center operations, energy sources, and an expanded fiber-optic network. Additionally, Google and WPP have expanded their partnership to enhance AI marketing capabilities, with WPP committing $400 million to Google technologies. Lastly, Google plans to invest $9 billion in South Carolina to expand its data center operations and support local workforce development, reinforcing the state’s role as a key infrastructure hub.
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