Why Analysts See Limited Upside for Alphabet (GOOGL) Despite PT Boost

Alphabet Inc. (NASDAQ:GOOGL) is one of the AI Stocks Investors Are Watching Closely. On September 3, Rosenblatt analyst Barton Crockett raised the price target on the stock to $224.00 (from $211.00) while maintaining a Neutral rating.

The rating affirmation follows Judge Amit Mehta’s search remedy ruling. Crockett noted that even though the court ruling has taken the near-term potential of breakup to the Apple distribution deal off the table, long-term concerns still remain.

He elaborated that AI chatbots could still challenge Google Search’s dominance in the future.  The firm’s Neutral rating reflects these looming AI competition risks that remain and their potential to limit how high the stock trades in the long-run.

“Judge Amit Mehta’s search remedy ruling bolsters long-term competitive risks to Google search from AI chatbots, but takes the near-term potential of breakup or disruption to the Apple distribution deal off the table."

"While breakup was never widely expected, and our base case had been that Apple payments would also continue, investors understandably are relieved that near-term risks are dissipated. We factor less risk into a higher multiple assumption (13x EV/EBITDA now, 11x before, supported by a mid-teens EBITDA growth rate) to up our price target $13 to $224. We retain our NEUTRAL rating, in the belief that long-term concerns about competitive risks to search will constrain the multiple.”

Alphabet Inc. (NASDAQ:GOOGL) is an American multinational technology conglomerate holding company wholly owning the internet giant Google, amongst other businesses.

While we acknowledge the potential of GOOGL as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

READ NEXT: 10 Must-Watch AI Stocks on Wall Street and 10 AI Stocks to Watch Out For in 2025.

Disclosure: None.