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Wedbush's 7 Reasons To Like Alphabet

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Wedbush's 7 Reasons To Like Alphabet

The bullish case for Alphabet Inc (NASDAQ: GOOG) (NASDAQ: GOOGL) is based on seven factors, according to Wedbush.

The Analyst

Wedbush's Michael Pachter initiated coverage of Alphabet with an Outperform rating and $1,350 price target.

The Thesis

Pachter highlighted the seven positive attributes that he said support a bullish stance on Alphabet. (See the analyst's track record here.) 

  • Google and its products are considered to be the "default gateways" to the entire internet. This concept extends beyond the core search platform to include the primary global email platform (Gmail) and one of the best video streaming platforms (YouTube).
  • Alphabet's ability to gather a trove of information from users implies it can offer superior ad targeting abilities and better value to advertisers.
  • Google's total advertising business generated $106 billion for the one-year period ending June 30, making it a leader in the category. For instance, Google's ad business is more than double the size of Facebook, Inc. (NASDAQ: FB), which had ad revenue over the same time period of $47.8 billion.
  • Google boasts the ability to control the content and ads consumers see "after they search for any term at any time at any location and on any device."
  • Chrome's 67.9-percent market share on desktop and 57.4-percent market share on mobile devices is not only "significantly" higher than its peers, but gives it the ability to show users more relevancy than ever before.
  • Android phone shipments for 2018 are estimated to come in at 1.23 billion, more than five times that of iOS devices. Android's global market leadership adds another dimension to its data collection efforts.
  • Google could become a major winner in the smart speaker category, as Amazon.com, Inc. (NASDAQ: AMZN)'s devices appeal mostly to its own Prime members. "Billions of consumers" are up for grabs by Google.

Price Action

Alphabet shares were down 2.78 percent at $1,096.20 at the time of publication Thursday.

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Google Home Is Gaining Ground On Amazon Echo

Photo courtesy of Google. 

Latest Ratings for GOOG

DateFirmActionFromTo
May 2019MaintainsBuy
Feb 2019MaintainsOverweightOverweight
Feb 2019MaintainsBuyBuy

View More Analyst Ratings for GOOG
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Posted-In: Echo Google Michael Pachter Smart SpeakerAnalyst Color Price Target Initiation Analyst Ratings Best of Benzinga

 

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