Investment bank Stifel resumed coverage of Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) stock today with a $130 price target and a “buy” rating. The firm’s price target is about 30% above the current price of GOOGL stock.
Stifel does not expect Alphabet’s key search ad business to be tremendously hurt by Microsoft’s (NASDAQ:MSFT) artificial intelligence (AI) initiatives.
The note appears to be making some investors more excited about Big Tech stocks.
Stifel’s Take on Alphabet
Although Microsoft’s efforts to improve its Bing search engine with OpenAI seem to be improving, there probably won’t be a “monumental shift” of consumers or ad dollars to Bing from Google, predicted Stifel analyst Mark Kelley.
Moreover, Kelley is upbeat about Alphabet’s YouTube and YouTube TV offerings.
Data From Bank of America Supports Stifel’s View of GOOGL Stock
On March 13, Bank of America analyst Justin Post reported that, based on data the bank had obtained, Google’s “Web traffic [and] search download activity” were not affected by Microsoft’s incorporation of OpenAI into Bing, The Fly reported. Google’s market share “has been stable since November,” Post added.
Also noteworthy is that, according to Post, comments by Alphabet’s Chief Financial Officer earlier this month indicate that the company will start integrating AI with its products. The financial impact of those initiatives is expected to be “reasonable.”
Bank of America maintained a $125 price target and a “buy” rating on GOOGL stock.
In the future, investors who own or are interested in buying Alphabet’s shares should attempt to monitor the market share of Google’s search engine.
More Information About Alphabet
Alphabet’s managers rejected efforts by two of the company’s employees to incorporate advanced AI into several of the company’s offerings “more than two years ago,” The Wall Street Journal reported earlier this month.
GOOGL stock is up 15% so far in 2023, but it’s down 25% over the last 12 months.
On the date of publication, Larry Ramer did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
