Alphabet, Meta, Pinterest, And Snap Shares Catch Attention As New Coverage Initiated By Analysts

Large and mid-cap tech companies, specifically shares of Alphabet Inc GOOG GOOGL, Meta Platforms Inc META, Pinterest Inc PINS, and Snap Inc SNAP are under the spotlight as analysts at Wells Fargo initiated coverage on the stocks Wednesday.

The Wells Fargo Analyst: Ken Gawrelski initiated coverage on Google with an Equal Weight rating, giving it a $117 price target.

Gawrelski initiated coverage on Meta with an Equal Weight rating, with a $276 price target.

The analyst initiated coverage on Pinterest with an Equal Weight rating and a $23 price target.

Gawrelski initiated coverage on Snapchat with an Equal Weight rating and a $10 price target.

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AI's Turning Tide: Gawrelski’s focus is trained on Google’s search engine transitioning to an AI-powered conversational search. The analyst said Google’s dominant position with a market share of over 90% in search advertising is expected to see disruptive challenges in the medium-term.

He highlighted potential scenarios including pricing volatility, aggressive bidding from competitors for Google’s search distribution partnerships, and potential pressure on profitability.

On Meta, Gawrelski noted that near-term optimism around advertising acceleration and Advantage+ adoption will likely be tempered by diminishing returns.

The analyst said Advantage+ now accounts for roughly 25% of total spending on Meta, a sharp increase from 9% at the end of 2022. However, its growth is likely to be capped by less ad buyer optimism around the medium-term monetization of Meta’s Reels feature.

While Gawrelski didn't provide detailed comments on Pinterest and Snapchat, given the shared dynamics of the large cap internet sector, the companies are expected to navigate similar market shifts, including the continuing evolution of AI in advertising and a potential shift towards more conversational and interactive forms of search and engagement.

Price Check: Shares of Alphabet were trading 0.3% lower at $122.48, Meta was up 0.5% at $265.03, Pinterest was down 1.7% at $23.96 and shares of Snap were falling 1.2% to $10.06 at last check on Thursday, according to Benzinga Pro data.

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