Backed by robust increase in subscriptions, devices, and Google Cloud, Alphabet Inc. (GOOG, GOOGL) saw its shares rise up to 7% Wednesday as the company posted better-than-expected Q3 results. Alphabet exceeded projections by $0.27, posting GAAP EPS of $2.12, and revenue of $88.27 billion, over 15% rise from last year. Positive forecasts from Wall Street analysts focused on Alphabet’s strategic monetizing initiatives and developments in generative artificial intelligence (GenAI). Reiterating its Buy rating and establishing a $210 price target, Needham noted Alphabet’s capacity to shrink the monetization gap between GenAI searches and conventional searches. “Google leads GenAI based on its search dominance and 1st-party data advantage,” the company said.
Citi also reaffirmed its Buy rating with a $216 target, noting 35% annual growth of Google Cloud. The company highlighted the more general AI improvements as well as the integration of Gemini AI across important products such Google Maps. With price predictions ranging from $205 to $235 and stressing Google’s effective AI monetizing, internal cost cuts, and expanding AI touchpoints, analysts from Evercore ISI, Morgan Stanley, Jefferies, and Wedbush reiterated these ideas. Jefferies referred to it as “an all-around winner,” noting how cloud transactions and AI’s increase in ad efficacy help.
This article first appeared on GuruFocus.
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