Alphabet Stock Rises 3.6% to Record High. JPMorgan Raises Alphabet's PT to $300 on AI Strength

TigerOct 28, 2025 12:24 AM

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JPMorgan has raised its price target on Alphabet stock to $300.00 from $260.00 while maintaining an Overweight rating. The stock currently trading near its 52-week high after delivering a remarkable 57% return over the past six months.

Alphabet shares rose 3.6% to hit a record high on Monday.

The firm notes that Alphabet is the second-best performing "Mag 7" name year-to-date, up 37% and 80% from April lows, compared to the S&P 500’s 15% and 36% gains respectively. JPMorgan cites the favorable outcome in the DOJ Search Commercial Agreement trial as removing a major overhang, while highlighting Google’s strong financial performance and AI innovation.

JPMorgan believes YouTube ad growth could accelerate on share gains and better AI leveraging, while Google Cloud growth should also accelerate based on its AI positioning and TPU infrastructure, including recent deals with Anthropic, Meta, and OpenAI. The company’s strong revenue growth of 13% and robust gross profit margin of 59% support this expansion trajectory. InvestingPro subscribers can access 15+ additional key insights about Alphabet’s growth metrics and industry position.

The firm is making three adjustments to its model ahead of Wednesday’s earnings: adding approximately $4.25 billion in regulatory fines/accruals in Q3, increasing Google Cloud estimates beginning 2026 primarily for the recently announced Anthropic expansion, and increasing capital expenditure estimates to $114 billion for 2026 and $125 billion for 2027.

JPMorgan expects the upcoming Gemini 3 launch to further strengthen the Google ecosystem and serve as a catalyst for shares, noting that while competition with OpenAI will intensify, Google has key advantages in data, distribution, and balance sheet strength. InvestingPro data confirms this financial robustness, showing the company holds more cash than debt and maintains a healthy current ratio of 1.9, while its cash flows adequately cover interest payments.

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