Keybanc Capital Markets analyst Justin Patterson maintained Google parent Alphabet Inc (NASDAQ:GOOGL) with an Overweight rating and raised the price forecast from $195 to $215 on Wednesday.
Patterson raised his expectations for the ad industry ahead of second-quarter results, reflecting a stable macro environment and positive product cycles. The analyst noted that stocks, including Alphabet, are starting to price in potential upside, with focus on AI initiatives, advertiser momentum and expense efficiencies.
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The company is expected to report a solid second quarter with $94.6 billion in revenue, surpassing consensus, with growth fueled by Search, YouTube and Cloud, Patterson noted. The analyst raised EPS estimates for 2025 and 2026 by 1% and 2%, respectively, with 2027E EPS forecasted at $12.25.
The macro outlook remains stable, with positive agency commentary and improving consumer trends, he noted. While trade talks remain fluid, Patterson noted a favorable environment compared to 90 days ago. Foreign exchange tailwinds are expected to continue, benefiting companies like Alphabet, the analyst said.
Additionally, the reverse acqui-hire trend has proven successful for big tech, boosting talent acquisition and innovation, further strengthening Alphabet’s position in the AI landscape, he added.
GOOGL Price Action: Alphabet stock is down 0.12% at $182.75 at last check on Thursday.
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