Marcos Milla
Former Analyst at the Federal Reserve, ETF/Stock Newsletter Author
Alphabet is easily a $500 stock and should outperform Nvidia over the next five years, because it controls every layer of AI. DeepMind powers Gemini, now at 750 million-plus monthly users, and 8th-generation TPUs give it a speed and cost edge. Even if customers pick a rival model, Anthropic's $200 billion cloud contract runs on Google Cloud and TPUs; as analysts put it, every AI winner needs Google in its supply chain. Top analysts target $460-500. x.com x.com x.comÂ
Alphabet's revised analyst price targets still imply substantial upside after its 10% drop. BNP Paribas, BMO, JPMorgan, Barclays, Morgan Stanley, Goldman Sachs, Fubon and Baird cut their targets, but the new $375-$425 range remains 30-47% above the current share price; is this a buy-the-dip opportunity? x.comÂ
Alphabet's earnings growth makes its valuation look attractive. It trades at 21x forward earnings and a 0.47 PEG while EPS grows 34% year over year; shares are down almost 9% year to date. Search still grows 12% and Cloud grows 103%, undercutting the concern that Search will sink the business. x.com x.comÂ
Alphabet's core Search growth is slowing while AI spending surges, making the selloff look deserved despite fast Cloud growth. Search growth fell from 19% to 17% to 12% over three quarters; Search now represents just under half of revenue. The stock could fall to $250, though Amazon is the preferred buy. x.com x.com x.com x.com x.comÂ
Alphabet's rapid cloud growth and diverse profit sources make it a long-term buy below 20x forward earnings. Cloud grew 103% this quarter, despite short-term fears about search and heavy spending. x.comÂ
Alphabet's AI-mode ads could move the needle, giving the stock a tentative upside bias despite search uncertainty. Search supplies $39b of $41b in quarterly segment profit, but its revenue growth slowed to 12% and will likely slow to 10% in Q4. Queries remain healthy; Alphabet says AI queries are mostly additive. Cloud revenue grew 96% year over year. At 18x a slightly above-consensus 2027 GAAP EPS estimate for over 30% operating profit growth, the stock remains a tough call. x.com x.com x.comÂ
Alphabet's higher capex guidance compounds the risk that already demanding revenue estimates must fall. The Street expected 25% revenue growth in 2027 and 21% in 2028; as 2028 earnings consensus resets, a 10% stock decline could be justified. x.comÂ
Alphabet remains fundamentally strong because revenue rose 25%, Cloud grew 103% to $30.7B with record margins, and search queries reached a five-year high. Ads grew 12% instead of 17% expected, while 2027 capex rises again, so the market is repricing it from a cash-printing ad company into an AI spender. x.comÂ
Alphabet's cloud business could reach $100 billion over the next year or so. Kalshi Finance says Google Cloud revenue grew 103% to $30.7 billion. Alphabet is spending $51.36 billion on AI infrastructure and reported an $8.664 billion equity-securities loss because of SpaceX. The stock looks like a good buy on the dip, with prices below $300 in oversold territory. x.com x.comÂ
Alphabet is down because of negative free cash flow and stock offerings, even though everything else is firing on all cylinders, with cloud revenue up 82% per @Venu_7_. Q2 2026 free cash flow was -$5.9B, driven by heavy capex; a slowdown in AI spending could help the hyperscaler FCF trade. Bidding again makes sense in a month or two, or once the stock starts reversing. x.com x.com x.comÂ
Alphabet's vertical integration and moat make its current valuation attractive. Its forward P/E is 19.78, below the 22.51 median shown since 2019. Alphabet is also valued below Tesla and SpaceX combined, despite the chart showing Google's quarterly revenue far exceeding theirs; that comparison does not add up. x.com x.comÂ