Google-parent Alphabet Inc.’s stock price target was reduced by Monness Crespi Hardt on Tuesday, as positive trends in digital advertising and cloud growth bump up against an apparent recession and a turbulent market environment.
The search and digital advertising heavyweight’s stock GOOGL, -2.50% GOOG, -2.45% fell 1.3% in premarket trading, after slumping 7.8% amid a five-day losing streak through Friday.
Analyst Brian White lowered its 12-month price target to $2,900 from $3,500. White maintained his buy rating on Alphabet.
Like other tech companies, Alphabet is bracing for turbulent times, but White believes the company is well positioned to emerge stronger “on the other side.”
“We believe Alphabet will benefit from long-term digital ad trends, experience healthy secular growth in the cloud, and repurchase stock at a generous pace,” wrote Monness Crespi Hardt analyst Brian White, in a note. “[H]owever, the economy appears to be in a recession, regulatory headwinds persist, equity markets are in turmoil, and we expect the geopolitical landscape will grow more precarious.”
In April, Alphabet announced a $70 billion share buyback program, a significant increase on the $50 billion share buyback it authorized last year.
Alphabet shares have fallen 24.93% this year, outpacing the S&P 500’s SPX, -1.73% decline of 19.11%.
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Of 50 analysts surveyed by FactSet, 48 have a buy or overweight rating on Alphabet and two have a hold rating. The average stock price target is $3,161.85, which implies about 45% upside from Friday’s closing price.
Alphabet’s stock has dropped 249% year to date through Friday, while the Nasdaq Composite Index COMP, -1.77% has slumped 28.9% and the S&P 500 index SPX, -1.73% has shed 19.7%.
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