Interactive Brokers shares jump as it secures spot in S&P 500
On Wednesday, Truist Securities adjusted its price target for Alphabet stock (NASDAQ:GOOGL), reducing it to $220 from the previous $225, while still recommending a Buy rating for the company’s shares. According to InvestingPro data, Alphabet currently trades at a P/E ratio of 25.12 and maintains a "GREAT" financial health score. The firm’s analysts cited Alphabet’s in-line fourth-quarter performance and higher capital expenditure (Capex) guidance for fiscal year 2025 as reasons that do not support the stock at an all-time high.
The analysis by Truist Securities highlighted Alphabet’s strong competitive position, as evidenced by the performance in its Search and YouTube (YT) segments. With impressive revenue growth of 14.38% and a market capitalization of $2.32 trillion, Alphabet has shown resilience and maintained its market strength despite the emergence of new AI search platforms. However, the slower growth in the Cloud division and a significantly higher Capex forecast for FY25 suggests that the company will require more investments in the coming years. For detailed financial analysis and more insights, check out the comprehensive Pro Research Report available on InvestingPro.
Truist Securities remains optimistic about Alphabet’s prospects, underlining the company’s solid fundamentals and attractive valuation. The analysts noted positive developments in Search, with increased user engagement and more opportunities for monetizing ads through AI innovations (AIO). InvestingPro analysis reveals strong return metrics, with a return on assets of 22.8% and robust cash flows that easily cover interest payments. They believe that Alphabet continues to lead in the AI domain, which could potentially enlarge the total addressable market (TAM) for both Search and Cloud services, driving long-term growth and enhancing value for shareholders.
The revised price target of $220 reflects adjustments to Truist Securities’ estimates based on the anticipated higher Capex. Despite the adjustment, the firm’s stance on Alphabet remains positive, with expectations of sustained growth fueled by advancements in AI and the company’s strong market position.
In other recent news, Alphabet Inc. has been the subject of various analyst reports following its fourth-quarter earnings release. Stifel maintained its Buy rating and a $225.00 price target, highlighting Alphabet’s commitment to expand its technical infrastructure and AI initiatives with a significant planned capital expenditure of $75 billion for the current year. This investment is expected to drive the company’s future performance, especially in the realms of AI and Connected TV advertising.
Cantor Fitzgerald adjusted its price target for Alphabet stock, reducing it to $200 from the previous $210 while maintaining a Neutral rating. The firm’s analyst noted that Alphabet’s fourth-quarter performance aligned with Wall Street’s revenue estimates, with earnings before interest and taxes (EBIT) and earnings per share (EPS) 2% higher than expected. However, the company’s Cloud segment experienced a deceleration in revenue growth due to competition and capacity constraints.
Guggenheim Securities increased the price target to $220 from the previous $215 while reiterating a Buy rating. The firm expects that Alphabet’s investments in AI infrastructure will lead to substantial long-term growth. Canaccord Genuity reiterated its Buy rating and $225.00 price target, noting Alphabet’s leadership in product innovation will facilitate the successful integration of AI into its search business.
Finally, Citi analysts lowered the price target from $232.00 to $229.00, while reaffirming a Buy rating. Despite acknowledging capacity constraints and a substantial increase in capital expenditure for 2025, the analyst remains optimistic about Alphabet’s future, anticipating that the expansion of Search AI Overviews will drive higher query volumes and support sustained growth in Search.
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