The recent pullback in the tech sector hasn’t left Alphabet (NASDAQ: GOOGL) stock unaffected, as it retraced by 0.87% in the previous month, and 4.03% in the previous five trading sessions.
On the daily chart, the losses of 0.02% are effectively mitigated by the pre-market gains of 1.39%, setting the GOOGL stock price at $180.13, at the time of publication.
And with second-quarter earnings scheduled for release on July 23 after the markets close, GOOGL stock could receive a positive boost if it beats analysts’ expectations.
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What do analysts expect from Alphabet’s Q2 earnings?
Google parent Alphabet is scheduled to report its second-quarter earnings after the bell on July 23, with investors and experts keenly focused on sustained cloud growth and updates on artificial intelligence (AI) initiatives.
According to estimates, the tech giant is projected to report revenue of $84.3 billion, representing a 13% increase from the same period last year.
Net income is expected to reach $23 billion, or $1.85 per share, up from the second quarter of 2023.
Wall Street is bullish on GOOGL stock
Experts on Wall Street believe that the internet giant should have no trouble posting a beat on revenue expectations, and they see its involvement in the AI landscape as a critical factor that could influence future growth.
Wedbush analyst Scott Devitt reiterated an Outperform rating for Google stock on July 23, maintaining the target price at $205, noting, “We think the setup remains positive heading into 2Q results,” and emphasizing strong indicators from their ad survey and agency feedback that suggest continued strength of Google Search.
In a research note from July 19, RBC analyst Brad Erickson advised customers to “buy” GOOGL stock, setting a price target of $200. His recommendation is based on the company’s earnings cycle, increasing involvement in the AI sector, and noteworthy cloud enterprise.
Jefferies analysts expect Alphabet’s stock to rise gradually rather than sharply from its current position. Despite a substantial 30% year-to-date increase, Jefferies predicts slower growth in the year’s second half due to tougher comparisons and high valuations.
Alphabet’s fundamentals remain strong, with solid ad spend, potential boosts from the Olympics and elections, and steady Cloud progress. The firm maintains a “buy” rating and a $220 price target.
On July 17, BMO Capital Markets analysts raised their price target on GOOGL shares from $215 to $222, reflecting increased optimism for the Search and YouTube businesses due to their effective AI capabilities.
Over the past year, Alphabet’s Search share has grown by 130 basis points in the U.S. and 310 basis points globally.
Analysts attribute this growth to the rise in repeat query behavior, driven by the proliferation and adoption of chatbots embedded in most apps, encouraging users to return more frequently.
Overall, the sentiment surrounding GOOGL stock on Wall Street is predominantly bullish, with an average price target of $202.89, indicating a 14.2% potential upside, and a “strong buy” rating based on 39 expert’s opinions.
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