TLDR
- J.P. Morgan raised its Alphabet price target to $425 from $420, implying about 24% upside.
- Analyst Doug Anmuth now expects Google Cloud revenue to grow 100% in Q3, up from 88%.
- Alphabet reports third-quarter earnings on Oct. 28.
- Citizens kept its $515 target but flagged a dip in YouTube viewing time.
- Alphabet slid 0.2% Thursday as the tech selloff deepened.
Alphabet’s GOOG stock was up 0.13% at $349.98 on Wednesday, according to Benzinga Pro. Investors are now looking ahead to earnings.
J.P. Morgan analyst Doug Anmuth raised his price target to $425 from $420 early Thursday. The new target implies a rally of about 24% from current levels.
Alphabet reports third-quarter results on Oct. 28. The company carried a $4.23 trillion market value as of Wednesday’s close, the third largest in the world.
Google Cloud is doing the heavy lifting here. Anmuth now expects its revenue to grow 100% in the third quarter, up from an 88% estimate.
Demand for tensor processing units is behind the jump. These custom chips power data centers and AI large-language models.
What J.P. Morgan Is Watching
“The primary driver of the increase is greater TPU sale inclusion, & we could still be conservative,” Anmuth said. That last part suggests he sees room for more.
He also raised his 2027 earnings forecast for Alphabet by 3% to $14.05 a share. The change comes on top of the higher Cloud estimate.
Anmuth lifted his growth estimate for Amazon, citing its scaling partnership with OpenAI. He also adjusted his Meta model for $10 billion in expenses tied to a proposed legal settlement with 52 state attorneys general.
Big Tech earnings carry extra weight this quarter. Investors worry about a flare-up in inflation and AI debt, and the AI trade has faltered.
Other Alphabet News This Week
Citizens analyst Andrew Boone kept a Market Outperform rating and a $515 price target on Wednesday. His note pointed to a dip in YouTube engagement.
Global YouTube viewing time fell about 1.4% from a year ago, the second straight monthly decline. Monthly users still rose 2.4%, and daily users rose 1.3%.
YouTube holds the top spot with about 33% of U.S. time and 28% of global time. Instagram and TikTok took roughly 175 basis points of global share from it over the year.
U.S. time spent rose 4.2%, down from 6.5% growth the month before. Boone noted that over half of U.S. YouTube viewing happens on TVs, which the data does not count.
Google DeepMind and Google Cloud also launched a program for European scientists on Wednesday. Up to 200 researchers get access to frontier models such as AlphaFold 3 and WeatherNext, plus $3 million in compute credits.
Google Play added a way to build personal Android apps with Google AI Studio, no developer registration needed. The rollout began Tuesday in select markets, including the U.S.
Alphabet was not spared in Thursday’s tech selloff. The stock slid 0.2%, while Amazon fell 1.5% and Meta declined 0.8%.
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