The Key Figure That Indicates Why Alphabet Is a Good Investment Right Now
Written by Emily J. Thompson, Senior Investment Analyst
Source: Yahoo Finance
Updated: Nov 08 20250mins
Google Cloud Backlog Growth: Google Cloud's backlog surged to $155 billion in Q3, marking a 46% increase quarter-over-quarter and 82% year-over-year, driven largely by AI-related services and multi-year contracts with large enterprises.
Operating Margins Improvement: The operating margins for Google Cloud improved to 23.7% in Q3, up from 17% the previous year, indicating strong profitability as the company scales its operations.
AI Integration and Market Position: Over 70% of the backlog is tied to AI services, with significant adoption of Google’s Gemini models and TPUs, positioning Google Cloud to capture a larger share of the growing cloud market projected to reach $2 trillion by 2030.
Investor Outlook: Analysts predict that Google Cloud could contribute over 20% to Alphabet's revenue by 2027, and the current backlog provides investors with a roadmap for sustained profitability, making Alphabet a compelling buy in the tech sector.
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Analyst Views on GOOGL
Wall Street analysts forecast GOOGL stock price to fall over the next 12 months. According to Wall Street analysts, the average 1-year price target for GOOGL is 312.00 USD with a low forecast of 236.00 USD and a high forecast of 350.00 USD. However, analyst price targets are subjective and often lag stock prices, so investors should focus on the objective reasons behind analyst rating changes, which better reflect the company's fundamentals.
38 Analyst Rating
31 Buy
7 Hold
0 Sell
Strong Buy
Current: 317.620
Low
236.00
Averages
312.00
High
350.00
Current: 317.620
Low
236.00
Averages
312.00
High
350.00
Truist
Buy
upgrade
$320 -> $350
2025-12-05
New
Reason
Truist
Price Target
$320 -> $350
2025-12-05
New
upgrade
Buy
Reason
Truist raised the firm's price target on Alphabet to $350 from $320 and keeps a Buy rating on the shares as part of a broader research note previewing the Holiday Season for Internet names. This Holiday Season to hit a record high for U.S. e-commerce and Digital Ad spending, driven by a resilient consumer buoyed by a healthy job market and more efficient digital ad channels fine-tuned by advancements in AI, the analyst tells investors in a research note. Third-party tracking shows that aggregate quarter-to-date holiday spending is off to a strong start, Truist notes. The firm adds that its price target increase reflects higher advertising revenues, sustained momentum across e-commerce so far this Holiday Season, and to a lesser extent higher revenue assumptions for Other Bets in the outer years from Waymo's accelerating roll-out more cities across the country.
Pivotal Research
Jeffrey Wlodarczak
Buy
maintain
$350 -> $400
2025-12-05
New
Reason
Pivotal Research
Jeffrey Wlodarczak
Price Target
$350 -> $400
2025-12-05
New
maintain
Buy
Reason
Pivotal Research analyst Jeffrey Wlodarczak raised the firm's price target on Alphabet to $400 from $350 and keeps a Buy rating on the shares. The firm cites continued momentum in the company's core business lines for the target boost. Google's search business "is a resilient cash cow with pricing power," the analyst tells investors in a research note. Pivotal sees an opportunity for Alphabet to leverage artificial intelligence to take "massive costs" out of its search business.
Northland
analyst
Outperform
initiated
$85
2025-12-02
New
Reason
Northland
analyst
Price Target
$85
2025-12-02
New
initiated
Outperform
Reason
Northland initiated coverage of Synaptics (SYNA) with an Outperform rating and $85 price target. The company has a robust AI-enabled processor family and has partnered with Google (GOOGL) for Edge AI applications, notes the analyst, who calls Synaptics "a leader in the shift to Edge AI applications."
Wedbush
Dan Ives
Strong Buy
maintain
2025-11-26
Reason
Wedbush
Dan Ives
Price Target
2025-11-26
maintain
Strong Buy
Reason
Wedbush analyst Dan Ives views Nvidia (NVDA) as "the foundation for the AI Revolution," with "the Godfather of AI Jensen having the best perch and vantage point to discuss overall enterprise AI demand and appetite for Nvidia's AI chips looking forward." Google's (GOOGL) TPU chips along with its key partner Broadcom (AVGO) are gaining some clear momentum in the AI market, the firm notes. That said, the AI Revolution "starts and ends with Nvidia today," Wedbush argues, and that is not changing for another few years, in the firm's opinion. With the trillions set to be spent over the coming years, many Big Tech players will benefit besides Nvidia on the chip front, but that should not be mistaken for Nvidia being the indisputable "Rocky Balboa champion of the AI Revolution," Wedbush adds.
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About GOOGL
Alphabet Inc. is a holding company. The Company's segments include Google Services, Google Cloud, and Other Bets. The Google Services segment includes products and services such as ads, Android, Chrome, devices, Google Maps, Google Play, Search, and YouTube. The Google Cloud segment includes infrastructure and platform services, collaboration tools, and other services for enterprise customers. Its Other Bets segment is engaged in the sale of healthcare-related services and Internet services. Its Google Cloud provides enterprise-ready cloud services, including Google Cloud Platform and Google Workspace. Google Cloud Platform provides access to solutions such as artificial intelligence (AI) offerings, including its AI infrastructure, Vertex AI platform, and Gemini for Google Cloud; cybersecurity, and data and analytics. Google Workspace includes cloud-based communication and collaboration tools for enterprises, such as Calendar, Gmail, Docs, Drive, and Meet.
About the author
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Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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