In recent months, the stock market landscape has undergone significant shifts, with Alphabet, the parent company of Google, securing a position at the forefront of these changes. Alphabet’s stock has witnessed a substantial resurgence, climbing over 25% from its 52-week nadir, confidently breaching the pivotal 200-day Simple Moving Average (SMA) mark. This resurgence is noteworthy, especially considering the backdrop of current geopolitical uncertainties, including the recent aggressive actions taken by Israel against Iran, sparking apprehensions of a potential escalation in regional conflict. These developments have cast a shadow over the markets, contributing to a slight downturn in Alphabet’s stock by approximately 2% during pre-market trading. However, taking a step back to appreciate the broader landscape reveals Alphabet’s potential for a robust and sustained recovery.
Despite facing a generally tepid market environment, Alphabet has distinguished itself as a formidable contender, outstripping its peers with considerable gains. Arriving at this junction, Alphabet’s stock had ascended nearly 10% over the month, overtaking significant benchmarks such as the Invesco QQQ Trust and the SPDR Technology ETF, which both recorded gains slightly above 4% for the same timeframe. This performance prompts a compelling question for investors: Is it now the opportune moment to delve into Alphabet’s stock?
Morgan Stanley has recently reaffirmed its confidence in Alphabet’s trajectory, maintaining an ‘Overweight’ rating with an optimistic $185 price target. This endorsement stems from Alphabet’s unwavering dominance in AI innovation, alongside the speculated advantages accruing from its collaboration with OpenAI via Google Cloud. Analysts speculate that this partnership could significantly bolster Google Cloud’s standing in the enterprise sector, thereby propelling substantial revenue growth within the burgeoning cloud market.
Alphabet’s appeal extends beyond a single financial institution’s outlook, with a general ‘Moderate Buy’ consensus emanating from 40 analyst ratings. This consensus suggests a promising 13.69% upside potential, showcasing the market’s upbeat assessment of Alphabet’s prospects.
Alphabet has consistently demonstrated its command across the digital domain, undeterred by the disruptive forces of artificial intelligence on conventional search and advertising paradigms. At the Google I/O 2025 conference, Alphabet unveiled its pioneering Gemini AI models, underscoring its ambition to remain at the pinnacle of the AI revolution. JPMorgan echoed this sentiment, reinforcing an ‘Overweight’ rating alongside a $195 price target post-event, highlighting Alphabet’s strides in AI innovation and its enhanced monetization prospects.
Despite the entry of AI-driven search tools, Google Search maintains its preeminence, commanding the bulk of the U.S. market share. Google’s extensive infrastructure, coupled with its deep integration into the Android and Chrome ecosystem, solidifies its central role in users’ digital experiences. The AI Overviews feature, reaching over 1.5 billion users across 140 countries, exemplifies Alphabet’s capacity to scale AI ventures lucratively.
Alphabet’s diversified business model continues to thrive, with YouTube’s ad revenues hitting $10.47 billion in the last quarter, supported by robust engagement and growing subscription numbers. Google Cloud is making significant inroads, especially among enterprises leveraging its AI-driven tools. Waymo, Alphabet’s autonomous driving venture, is expanding its footprint across over ten U.S. cities, signaling promising long-term growth avenues as self-driving technology evolves.
However, challenges loom on the horizon. Alphabet’s search engine supremacy faces potential threats from competitors like Apple possibly pivoting to alternative AI-driven search engines for Safari and Siri. Besides, competitors such as Amazon and Meta are relentlessly vying for larger slices of the advertising pie, while emerging AI-native platforms could potentially circumvent traditional search mechanisms entirely. Coupled with ongoing antitrust scrutiny and tightening global privacy regulations, it is imperative for Alphabet to persist in its innovative pursuits to retain its market leadership.
From a technical standpoint, Alphabet’s stock presents an appealing proposition, having recovered all major moving averages, indicating a robust uptrend. The 200-day SMA, currently hovering near $171, now acts as a critical support level. A potential retracement to this threshold, if met with adequate support, may furnish a lucrative entry point for long-term investors.
Alphabet’s valuation remains attractive, with its current trading multiples sitting below its 10-year average P/E ratio. For those convinced of Alphabet’s enduring growth potential and ability to surpass market expectations, the stock evidently harbors significant value.
Given the diverse array of factors propelling and challenging Alphabet, the company stands at a confluence of opportunities and uncertainties. Investors contemplating an entrée or an augmentation to their stake in Alphabet must weigh these dynamics diligently. Alphabet’s fortitude, innovation, and adaptability in navigating the evolving digital landscape will be critical in sustaining its growth and maintaining its stature as a technological titan.
Shares of Alphabet (NASDAQ:) are officially back in bull market territory, having surged more than 25% off their 52-week low and reclaimed the key 200-day simple moving average (SMA). While geopolitical tensions, such as Israel’s recent strike on Iran and escalating fears of a broader conflict, have weighed on markets this morning, with GOOGL down around 2% in pre-market trading at the time of writing, the bigger picture suggests the stock may be staging a durable turnaround.
Despite broader market weakness, Alphabet has been a clear outperformer. Coming into Friday, GOOGL was up nearly 10% on the month, handily outpacing the Invesco QQQ Trust and the tech-focused SPDR Technology ETF, which were each up just over 4% in the same period.
With momentum building, is now the time for investors to take a serious look at Alphabet?
Morgan Stanley Sees Continued Upside and Leadership
On June 11, Morgan Stanley reiterated its Overweight rating and $185 price target for Alphabet, citing the company’s steady leadership in AI and a potential growth catalyst from its reported partnership with OpenAI through Google Cloud. Analysts believe that this collaboration could further enhance Google Cloud’s competitiveness in the enterprise space and drive substantial revenue growth in the expanding cloud market.
Morgan Stanley isn’t alone in their bullish assessment of the company. In total, GOOGL has a consensus rating of Moderate Buy based on 40 analyst ratings. Impressively, the consensus price target of $199.75 implies a potential 13.69% upside for the stock.
Alphabet Remains a Leader, But Some Headwinds Persist
Alphabet continues to assert its dominance across the digital landscape, even as artificial intelligence disrupts traditional search and advertising models. At the recent Google I/O 2025 conference, the company showcased its latest Gemini AI models, reaffirming its commitment to staying a leading player in the AI revolution.
JPMorgan reaffirmed its Overweight rating and $195 price target following the event, highlighting Alphabet’s AI innovations and growing monetization capabilities.
Google Search remains the undisputed leader, holding the lion’s share of the U.S. market. Despite the emergence of new AI-powered search tools, Google’s vast infrastructure and integration across the Android ecosystem and Chrome browser keep it deeply embedded in users’ lives. Its AI Overviews feature now reaches more than 1.5 billion users across 140 countries.
It is monetized similarly to traditional search, proof that Alphabet is scaling AI profitably, not just experimenting with it.
Beyond search, the company’s diversified portfolio is thriving. YouTube generated $10.47 billion in ad revenue during the last quarter, driven by robust user engagement and increasing subscriptions. Google Cloud continues gaining traction, particularly among enterprises adopting its AI-powered tools.
Meanwhile, Waymo is expanding its autonomous driving presence to over 10 U.S. cities, offering long-term upside as self-driving technology continues to mature.
Still, Alphabet faces meaningful headwinds. Its search dominance could come under pressure if Apple (NASDAQ:) opts to replace Google as the default engine on Safari and Siri, potentially favoring AI alternatives like Perplexity or ChatGPT. Amazon (NASDAQ:) and Meta (NASDAQ:) also continue to chip away at ad budgets, and emerging AI-native platforms threaten to bypass traditional search entirely.
With ongoing antitrust scrutiny and tightening global privacy regulations, it’s clear that Alphabet must continue to innovate aggressively to maintain its leadership position.
Technical Setup Points to an Attractive Entry
From a technical perspective, GOOGL has reclaimed all major moving averages, suggesting a strengthening uptrend. The 200-day Simple Moving Average (SMA), currently near $171, now serves as a potential support level. A pullback to this area, which finds support and forms a higher low, could offer a compelling entry point for long-term investors.
Valuation-wise, GOOGL remains attractively priced.
The stock’s 10-year average P/E ratio is near 28, yet it currently trades at a P/E of 19.5 and 17.3 times its forward earnings. For investors who believe Alphabet will continue to grow its revenues and profits and even outperform expectations, the stock still appears to offer considerable value.
