Alphabet wins price target raise at Roth Capital

Roth Capital Markets analyst Rohit Kulkarni maintained a “Buy” rating on Alphabet (Alphabet Stock Quote, Chart, News, Analysts, Financials NYSE:GOOGL) and raised his 12-month price target to $210 following a strong Q2 earnings beat.

“GOOGL reported emphatic clean-beat 2Q results, with Search, YouTube, and Cloud Revs accelerating and coming in above expectations,” he said in a July 24 note. Shares initially dipped on news that 2025 CapEx would rise from $75-billion to $85-billion, but reversed as management highlighted easing supply constraints and continued strong Cloud demand.

“At $195, GOOGL shares are trading at ~21x ’25E P/E (ex-cash),” Kulkarni said. “We believe multiple AI Search surfaces are proving to strengthen medium-term positioning as user behavior adapts, AI workload demand results in Cloud growth as an output of expanding compute profile, and YouTube is becoming more macro insulated with Shorts, sports deals, and subscriptions. Still, the range of outcomes of GOOGL’s anti-trust trials might weigh on multiple expansion over the next 90 days.”

Kulkarni noted that Alphabet’s rising CapEx trajectory could raise investor questions, with $22.4 billion spent in Q2 and a $10 billion increase in full-year 2025 guidance. He also sees management’s comments on growing “agentic AI” adoption in 2026 as a sign of future monetization potential. The higher CapEx outlook could have implications for peers like Amazon, Meta, and Microsoft.

Kulkarni thinks that Alphabet will generate EPS of $9.89 on $392.6-billion in revenue in fiscal 2025, up from his previous estimates of $9.71 and $386.3-billion. He expects further improvement in 2026, forecasting EPS of $10.52 on $429.8-billion in revenue, compared to earlier estimates of $10.23 and $420.2-billion. The changes reflect a 2% upward revision for both years.

“Our $210 price target is based on 20.0x ’26E GAAP EPS,” he said. “There are always risks that the target price for any security will not be realized. Factors that would cause the stock to deviate from our target price could come from sales and profits materially above or below forecasts, the relative success of other competitive products, and volatility related to consumer behaviour trends on digital media platforms.”

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