Technology

How Analysts Rate Alphabet Now After Earnings and After Outsizing Apple

Wikimedia Commons

Alphabet Inc. (NASDAQ: GOOGL) reached a milestone after earnings in the first week of February by overtaking Apple Inc. (NASDAQ: AAPL) as the world’s largest company by market capitalization. That was short-lived but impossible to ignore.

24/7 Wall St. wanted to see just how much more upside awaits the Google (sorry, Alphabet — old habits are hard to break) stock price. This was also a new report format because it broke out the moonshots and traditional operations. Alphabet still offers very little for its earnings guidance ahead.

The company had $8.67 in earnings per share (EPS) on $21.33 billion in revenue, compared to the consensus estimates from Thomson Reuters of $8.10 in EPS on revenue of $20.77 billion. The same period from the previous year had EPS of $6.76 and $18.10 billion in revenue. Aggregate paid clicks increased by 31% from the fourth quarter of 2014, and it was up by 17% sequentially. The aggregate cost-per-click also grew on the year-over-year basis by 13%.

Alphabet had just over $73 billion in cash and equivalents. Its shares closed up 1.2% at $770.77 on Monday ahead of earnings but initially popped up 7% or so after the earnings report, taking its $517.5 billion in market cap to around $553 billion or so — passing up Apple’s nearly $540 billion market cap. The problem is that investors were selling the FANG stocks this past week, and Google closed down 3.6% (some $26.27) at $703.76 on Friday for a market cap of $460 billion. Apple’s end-of-week price of $94.02 yields a market cap near $507 billion.


Alphabet’s post-earnings high last week was $810.35, so it was not a good week in the end for Alphabet. Still, Many analysts raised their price targets on Alphabet, including Jefferies, RBC Capital Markets, Merrill Lynch and Credit Suisse. Some of these calls have been rounded to the nearest $5.00 increment and were listed here:
  • Argus reiterated its Buy rating and reaffirmed its $900 target.
  • Barclays kept its Overweight rating but raised its target to $900 from $800.
  • BMO Capital Markets kept its Outperform rating but raised its target to $925 from $825.
  • Bank of America Merrill Lynch kept its Buy rating but raised its price objective to $945 from $905.
  • Canaccord Genuity kept its Buy rating but raised its target to $900 from $850.
  • Credit Suisse kept its Outperform rating but raised its target to $930 from $900.
  • Deutsche Bank kept its Buy rating but raised its target to $1,080 from $900.
  • FBR Capital Markets kept its Outperform rating but raised its target to $940 from $810.
  • Goldman Sachs kept its Buy and Conviction Buy rating but raised its target to $890 from $850.
  • Jefferies kept its Buy rating but raised its target to $950 from $900.
  • JPMorgan kept an Overweight rating but raised its price target to $970 from $900.
  • KeyBanc Capital Markets kept its Overweight rating but raised its target to $910 from $850.
  • Nomura Securities kept its Buy rating but raised its target to $925.
  • Oppenheimer kept its Outperform rating but raised its target to $965 from $820.
  • RBC Capital Markets kept its Outperform rating but raised its target to $1,000 from $880.
  • Stifel kept its Buy rating but raised its target to $930 from $900.

At $703.76, Alphabet has a 52-week trading range of $527.55 to $810.35. Its consensus analyst target from Thomson/First Call is roughly $924.00 (and rising). That consensus target was closer to $861 immediately before earnings.

Deutsche Bank’s $1,080 price target is the street high from all analysts. Alphabet’s lowest analyst price target is now $800.

Thank you for reading! Have some feedback for us?
Contact the 24/7 Wall St. editorial team.