Key Stats for Alphabet Stock
- Price change for Alphabet stock in last 5 days: -7%
- $GOOGL Stock Price as of Jul. 27: $327
- 52-Week High: $409
- $GOOGL Stock Price Target: $428
Now Live: Discover how much upside your favorite stocks could have using TIKR’s new Valuation Model (It’s free)>>>
What Happened?
Phillip Securities just upgraded Alphabet (GOOGL) stock to buy from accumulate, even while trimming its price target slightly to $425 from $450. That new target still points to a 33% upside from where Alphabet stock closed on Friday.
The upgrade comes after a strong Q2, where Alphabet posted 24% revenue growth and 24% adjusted profit growth year-over-year.
Analyst Serena Lim Yi Qi pointed to solid ad performance tied to Gemini integration, which grew more than 14% year-over-year, as a key driver.
Google Cloud was the standout segment, with revenue jumping 82% to $24.8 billion.
There is a catch, though. Alphabet posted negative free cash flow of $5.9 billion in the quarter, the first negative reading since the company went public back in 2004.
Heavy spending on AI infrastructure is the reason. Qi called this pressure temporary, writing that it should support stronger long-term AI growth and better revenue visibility down the road.
That spending isn’t slowing down either. Alphabet now expects 2026 capital expenditures between $195 billion and $205 billion, an increase from its prior forecast, as the company keeps investing to stay ahead in the AI race.
There’s also a bigger industry story worth knowing about. A Nikkei investigation found that Alphabet, along with Microsoft, Amazon, Meta, and Oracle, collectively carry about $1.65 trillion in off-balance-sheet obligations.
That’s more than the $1.35 trillion in debt these companies officially report. These obligations include things like GPU purchase agreements, data center leases, and joint ventures, and they don’t show up on the balance sheet until the related facilities actually go live.
As new AI infrastructure comes online, these commitments will gradually become visible. If AI demand doesn’t meet expectations, some of these assets could face write-downs, which would hit both shareholders and the private credit investors who helped fund the buildout.
See analysts’ growth forecasts and price targets for Alphabet stock (It’s free) >>>
What the Market Is Telling Us About Alphabet Stock
The upgrade suggests analysts see Alphabet’s core business as strong enough to absorb the near-term cash flow hit.
Revenue growth across search, YouTube, and cloud is broad-based, not dependent on just one segment.
Still, the negative free cash flow milestone is a signal worth watching.
Investors in Alphabet stock will want to see whether this AI spending cycle eventually converts into the kind of returns that justify record capital expenditure.
For now, Phillip Securities is betting that Alphabet stock’s long-term AI positioning outweighs the short-term cash flow pressure.
Estimate a company’s fair value instantly (Free with TIKR) >>>
How Much Upside Does Alphabet Stock Have From Here?
With TIKR’s new Valuation Model tool, you can estimate a stock’s potential share price in under a minute.
All it takes is three simple inputs:
- Revenue Growth
- Operating Margins
- Exit P/E Multiple
If you’re not sure what to enter, TIKR automatically fills in each input using analysts’ consensus estimates, giving you a quick, reliable starting point.
From there, TIKR calculates the potential share price and total returns under Bull, Base, and Bear scenarios so you can quickly see whether a stock looks undervalued or overvalued.
See a stock’s true value in under 60 seconds (Free with TIKR) >>>
Looking for New Opportunities?
- See what stocks billionaire investors are buying so you can follow the smart money.
- Analyze stocks in as little as 5 minutes with TIKR’s all-in-one, easy-to-use platform.
- The more rocks you overturn… the more opportunities you’ll uncover. Search 100K+ global stocks, global top investor holdings, and more with TIKR.
Disclaimer:
Please note that the articles on TIKR are not intended to serve as investment or financial advice from TIKR or our content team, nor are they recommendations to buy or sell any stocks. We create our content based on TIKR Terminal’s investment data and analysts’ estimates. Our analysis might not include recent company news or important updates. TIKR has no position in any stocks mentioned. Thank you for reading, and happy investing!
