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Alphabet Rises 34% in 3 Months: Buy, Sell or Hold GOOGL Stock?
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Key Takeaways
Alphabet shares jumped 34% in three months, outperforming tech and internet peers.
Favorable antitrust ruling keeps Google Search and Chrome intact, easing regulatory pressure.
Expanding AI Mode and Gemini integration boost Search engagement and support long-term growth.
Alphabet (GOOGL - Free Report) shares have risen 34% in the past three months, outperforming the Zacks Computer and Technology sector’s appreciation of 13.3% and the Zacks Internet Services industry’s 30.7%. GOOGL shares have beaten peers like Microsoft (MSFT - Free Report) , Apple (AAPL - Free Report) and Amazon (AMZN - Free Report) over the same time frame. While Apple and Microsoft shares have appreciated 17.9% and 1.5% respectively, Amazon has dropped 3.1%.
GOOGL’s outperformance can be attributed to a favorable antitrust ruling. Continuing AI push across its search and cloud solutions, as well as an expanding focus on improving enterprise footprint (through the launch of Gemini Enterprise), is expected to boost prospects amid stiff competition in the cloud computing domain and a challenging macroeconomic environment due to uncertainty over tariffs.
GOOGL Stock’s Performance
Image Source: Zacks Investment Research
Let us find out what investors should do with GOOGL stock now.
Easing Regulatory Headwinds Aids GOOGL’s Prospect
In the antitrust lawsuit against the Department of Justice (DOJ), Alphabet received a favorable ruling as the U.S. District Judge Amit Mehta ruled against the severe remedies proposed by the DOJ that included the forced divestiture of the Chrome browser and Android operating system. The ruling keeps Alphabet’s relationship with Apple untouched as the iPhone maker offers the Google Search engine as the default in its Safari browser.
However, Google now faces limitations on its distribution policy related to services and must share search data with rivals. Alphabet is prohibited from entering or maintaining exclusive contracts relating to the distribution of Google Search, Chrome, Google Assistant and the Gemini app. GOOGL now has to share certain search index and user-interaction data with rivals.
Google continues to dominate the Search business with a roughly 90% share, followed by Microsoft’s Bing, with 3.88% share, per the latest data from StatCounter. Alphabet’s Search business handles more than 5 trillion queries annually. The company has been actively embedding AI, especially within Search, to enhance user experience, provide better AI-focused features and consequently improve ad performance. This is driving Google Search and other revenues, which increased 11.7% year over year to $54.19 billion in the second quarter of 2025.
AI Push to Boost GOOGL’s Search Prospects
Alphabet is advancing visual and contextual search capabilities. The Circle to Search feature is now active on more than 300 million devices. The company is adding functionalities to help people explore complex topics and ask follow-up questions without switching apps.
AI Overviews now reach more than 2 billion users per month and are available in above 200 countries across 40 languages. It is now driving more than 10% more queries globally. Powered by Gemini 2.5, AI Overviews currently delivers the fastest AI responses in the industry. The combination of lens or Circle to Search, together with AI Overviews, is driving multi-modal search usage.
Google’s AI-powered Search features are driving deeper engagement, with AI Mode offering advanced reasoning and multi-modal responses. Users are generating queries twice as long as those in traditional searches. The launch of AI Mode in the United States and India, where it currently has more than 100 million monthly active users, is expected to drive growth.
GOOGL is expanding AI mode in Google Search by adding more than 35 languages and above 40 new countries and territories. AI Mode in Search is now expanded to more than 200 countries and territories.
Earnings Estimate Revisions Show Steady Trend for GOOGL
The Zacks Consensus Estimate for third-quarter 2025 earnings is pegged at $2.29 per share, unchanged over the past 7 days, indicating 8% year-over-year growth. The consensus mark for fourth-quarter 2025 earnings is pegged at $2.53 per share, unchanged over the past 7 days, indicating 17.7% year-over-year growth.
The consensus mark for 2025 earnings is pegged at $9.95 per share, unchanged over the past 7 days, suggesting 23.8% growth over the 2024 reported figure.
Alphabet’s growing AI-powered Search capabilities and significant investments in cloud computing bode well for long-term investors. Therefore, investors who have already invested in GOOGL stock should continue to hold on to it.
However, Alphabet is facing stiff competition in the cloud computing space, currently dominated by Amazon and Microsoft. GOOGL is suffering from a lack of capacity, and until new capacity comes online this year, cloud revenues are expected to witness increased variability. The company expects to invest roughly $85 billion in capital expenditure in 2025, which is aimed at building up technical infrastructure, primarily for servers, followed by data centers and networking.
A Value Score of D suggests a stretched valuation for Alphabet at this moment. GOOGL stock is overvalued, with a forward 12-month price/sales of 8.09X compared with the industry’s 6.37X, sector’s 6.9X and Amazon’s 3.01X. However, the GOOGL stock is cheaper than Microsoft’s 11.41X and Apple’s 8.4X.
Image: Bigstock
Alphabet Rises 34% in 3 Months: Buy, Sell or Hold GOOGL Stock?
Key Takeaways
Alphabet (GOOGL - Free Report) shares have risen 34% in the past three months, outperforming the Zacks Computer and Technology sector’s appreciation of 13.3% and the Zacks Internet Services industry’s 30.7%. GOOGL shares have beaten peers like Microsoft (MSFT - Free Report) , Apple (AAPL - Free Report) and Amazon (AMZN - Free Report) over the same time frame. While Apple and Microsoft shares have appreciated 17.9% and 1.5% respectively, Amazon has dropped 3.1%.
GOOGL’s outperformance can be attributed to a favorable antitrust ruling. Continuing AI push across its search and cloud solutions, as well as an expanding focus on improving enterprise footprint (through the launch of Gemini Enterprise), is expected to boost prospects amid stiff competition in the cloud computing domain and a challenging macroeconomic environment due to uncertainty over tariffs.
GOOGL Stock’s Performance
Image Source: Zacks Investment Research
Let us find out what investors should do with GOOGL stock now.
Easing Regulatory Headwinds Aids GOOGL’s Prospect
In the antitrust lawsuit against the Department of Justice (DOJ), Alphabet received a favorable ruling as the U.S. District Judge Amit Mehta ruled against the severe remedies proposed by the DOJ that included the forced divestiture of the Chrome browser and Android operating system. The ruling keeps Alphabet’s relationship with Apple untouched as the iPhone maker offers the Google Search engine as the default in its Safari browser.
However, Google now faces limitations on its distribution policy related to services and must share search data with rivals. Alphabet is prohibited from entering or maintaining exclusive contracts relating to the distribution of Google Search, Chrome, Google Assistant and the Gemini app. GOOGL now has to share certain search index and user-interaction data with rivals.
Google continues to dominate the Search business with a roughly 90% share, followed by Microsoft’s Bing, with 3.88% share, per the latest data from StatCounter. Alphabet’s Search business handles more than 5 trillion queries annually. The company has been actively embedding AI, especially within Search, to enhance user experience, provide better AI-focused features and consequently improve ad performance. This is driving Google Search and other revenues, which increased 11.7% year over year to $54.19 billion in the second quarter of 2025.
AI Push to Boost GOOGL’s Search Prospects
Alphabet is advancing visual and contextual search capabilities. The Circle to Search feature is now active on more than 300 million devices. The company is adding functionalities to help people explore complex topics and ask follow-up questions without switching apps.
AI Overviews now reach more than 2 billion users per month and are available in above 200 countries across 40 languages. It is now driving more than 10% more queries globally. Powered by Gemini 2.5, AI Overviews currently delivers the fastest AI responses in the industry. The combination of lens or Circle to Search, together with AI Overviews, is driving multi-modal search usage.
Google’s AI-powered Search features are driving deeper engagement, with AI Mode offering advanced reasoning and multi-modal responses. Users are generating queries twice as long as those in traditional searches. The launch of AI Mode in the United States and India, where it currently has more than 100 million monthly active users, is expected to drive growth.
GOOGL is expanding AI mode in Google Search by adding more than 35 languages and above 40 new countries and territories. AI Mode in Search is now expanded to more than 200 countries and territories.
Earnings Estimate Revisions Show Steady Trend for GOOGL
The Zacks Consensus Estimate for third-quarter 2025 earnings is pegged at $2.29 per share, unchanged over the past 7 days, indicating 8% year-over-year growth. The consensus mark for fourth-quarter 2025 earnings is pegged at $2.53 per share, unchanged over the past 7 days, indicating 17.7% year-over-year growth.
The consensus mark for 2025 earnings is pegged at $9.95 per share, unchanged over the past 7 days, suggesting 23.8% growth over the 2024 reported figure.
Alphabet Inc. Price and Consensus
Alphabet Inc. price-consensus-chart | Alphabet Inc. Quote
Here’s Why Investors Should Hold GOOGL Stock Now
Alphabet’s growing AI-powered Search capabilities and significant investments in cloud computing bode well for long-term investors. Therefore, investors who have already invested in GOOGL stock should continue to hold on to it.
However, Alphabet is facing stiff competition in the cloud computing space, currently dominated by Amazon and Microsoft. GOOGL is suffering from a lack of capacity, and until new capacity comes online this year, cloud revenues are expected to witness increased variability. The company expects to invest roughly $85 billion in capital expenditure in 2025, which is aimed at building up technical infrastructure, primarily for servers, followed by data centers and networking.
A Value Score of D suggests a stretched valuation for Alphabet at this moment. GOOGL stock is overvalued, with a forward 12-month price/sales of 8.09X compared with the industry’s 6.37X, sector’s 6.9X and Amazon’s 3.01X. However, the GOOGL stock is cheaper than Microsoft’s 11.41X and Apple’s 8.4X.
GOOGL’s Valuation
Image Source: Zacks Investment Research
Alphabet currently has a Zacks Rank #3 (Hold), suggesting that it may be wise to wait for a more favorable entry point to start accumulating the stock. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.