Pivotal Research Lifts Alphabet (GOOGL) Target to $400 as Cloud and Cash Flow Accelerate

Alphabet Inc. (NASDAQ:GOOGL) is one of the Must-Watch AI Stocks on Wall Street. On December 5, Pivotal Research raised its price target on the stock to $400.00 from $350.00 while maintaining a Buy rating. The firm’s optimism stems from Alphabet’s multi-year cloud momentum and free cash flow acceleration.

“Search is a resilient cash cow with pricing power, a powerful driver of GOOG’s best in class Gemini AI, with an opportunity to leverage AI take massive costs out of the search business.”

Pivotal Research has extended its forecast from year ’29 to ’20, adjusting its cloud revenue CAGR higher to account for expected market share gains.

The target terminal EBITDA multiple has also been raised in their DCF valuation methodology from 18X to 18.5X (8% discount rate), leading to a Street high target of $400.

Alphabet is anticipated to deliver solid multi-year growth across revenue, profitability, and cash generation.

“We expect Google’s 5-year (’26–’30) revenue CAGR to be 11% (even assuming slowing search), 14%+ EBITDA growth, and 26% free cash flow per share growth.”

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.

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