Google Stock Boosted By AI Growth, Cloud Expansion, Cost Discipline Despite DOJ And Generative AI Challenges: Analyst

Bank Of America Securities analyst Justin Post maintained a Buy rating on Alphabet Inc GOOG GOOGL Google with a price target of $225, up from $210.

In 2024, Alphabet stock (up 35%) outperformed the S&P 500 (up 23%) and benefited from new product launches offsetting Al concerns (OpenAI traction), strong cost discipline, improving Cloud growth and positive estimates revisions.

However, the threat of disruption from emerging Generative-Al search platforms and adverse judgment in the DOJ search case weighed on multiple versus FANG peers.

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With search still far outpacing the value of other businesses, Post noted 2025 as a pivotal year, which could help establish Google as either an Al leader (via AI Overview traction) or elevate search disruption risk.

Google’s potential positives include growing usage of AI overviews and new ad opportunities around informational queries, greater appreciation of AI assets and AI-driven performance driving multiple expansion, potential for change (or settlement) in Search case trajectory under new administration, increasing value contribution from cloud business, and new disclosures or cost cuts under new CFO.

However, Post lowered estimates for recent US dollar appreciation and lowered 2025 EPS to below-Street $8.78 (from $8.96). The price target boost reflects 2026 GAAP EPS of $10.06 (versus $10.31 previously) and a lower 21x multiple (versus 22x previously), plus cash.

Price Action: GOOGL stock is up 0.04% at $191.16 at last check Tuesday.

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