Alphabet Analysts Say AI Opportunity Not Reflected In Stock Price, Welcome Break Up Attempts: 'GOOGL Is Worth More In Pieces'

Alphabet Inc. GOOG GOOGL analysts break down the growth from YouTube and Cloud and identify opportunities and risks for the company after first-quarter financial results.

The Alphabet Analysts: Rosenblatt analyst Barton Crockett maintained a Neutral rating on Alphabet and lowered the price target from $205 to $189.

Bank of America analyst Justin Post reiterated a Buy rating and raised the price target from $185 to $200.

WestPark Capital analyst Curtis Shauger reiterated a Buy rating with a $210 price target.

Needham analyst Laura Martin maintained a Buy rating with a $178 price target.

Goldman Sachs analyst Eric Sheridan maintained a Buy rating and raised the price target from $205 to $220.

JPMorgan analyst Doug Anmuth maintained an Overweight rating and raised the price target from $180 to $195.

Rosenblatt on Alphabet: The tech company reported a "solid quarter," but future questions remain, Crockett said in a new investor note.

"The concern is the potential reality of macro risks near-term ramping up and slowing the ad trajectory, and antitrust and competitive risks longer term from a pair of recent major losses," Crockett said.

The analyst noted that Alphabet said little about guidance going forward. One comment from management was that the company is "not immune to macro."

Bank of America on Alphabet: Margin expansion was among the bright spots from the quarterly results, Post said in a new investor note.

The analyst said Alphabet showed strong execution in search and had upside potential from both search and subscriptions. Growth in AI was also shown in the report, which could be a storyline investors are missing, according to Post.

"We think stock valuation at 10x core business EPS does not reflect AI opportunity," Post said.

The analyst said Google is in a race with OpenAI, Perplexity and others for AI usage.

"We continue to believe Google has data and distribution advantages and has closed the LLM performance gap."

He said investors could be underappreciating Alphabet’s AI monetization ramp.

WestPark on Alphabet: The tech giant showed strong growth in Search and Cloud segments in the first quarter, Shauger said in a new investor note.

"GOOG saw broad-based strength across most of its segments and verticals," Shauger said.

The analyst said the company's operating margins were impressive in the quarter.

Needham on Alphabet: Strength in the ads segment for Alphabet showed minimal tariff impact, Martin said in a new investor note.

Martin said there is some concern that the company will not cut costs if revenue slows and will react late if tariffs impact the company. There was no mention of the words "tariffs" or "macro" during prepared remarks, the analyst added.

The analyst once again shared some sum-of-the-parts math to calculate how much YouTube and other segments could be worth if spun out from the tech giant.

Martin estimates YouTube is worth $60 per share, or around 38% of the company's total value. The analyst gives a valuation of $720 billion for YouTube, significantly higher than the $1.65 billion Alphabet originally paid to acquire the video platform company.

"The operating metrics for YouTube were strong in Q1. Watch time growth remains robust, particularly in key monetization opportunity areas such as shorts and living room," Martin said.

Martin said investors would likely pay more for a pure-play asset like YouTube and the company is seeing growth from advertising and subscriptions.

"We believe that GOOGL is worth more in pieces than together, so we welcome regulators' attempts to break up GOOGL."

Goldman Sachs on Alphabet: First-quarter results showed "resilient search & rising AI narratives," Sheridan said in a new investor note.

"Alphabet mgmt. emphasized their intention to drive operating efficiencies balanced with forward growth investments," Sheridan said.

The analyst said investments in AI are showing through in multiple segments. He noted that YouTube would continue to see strong monetization opportunities.

"In our view, Alphabet mgmt. continued to emphasize a very positive tone with respect to the scale for consumer and enterprise computing adoption of their AI solutions."

JPMorgan on Alphabet: Search monetization and AI innovation were highlights in the first-quarter results for Anmuth.

"Against a backdrop of competitive and macro concerns, Google delivered solid 1Q results w/upside in advertising revenue and operating income," Anmuth said.

The analyst said it was a positive quarter and that Google is seeing strong search monetization in a highly competitive field for AI.

GOOGL Price Action: Alphabet stock is up 1.8% to $162.15 on Friday versus a 52-week trading range of $140.53 to $207.05. Alphabet stock is down 14.4% year-to-date in 2025.

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