Alphabet (NASDAQ:GOOG) just got a fresh endorsement from Needham & Company, which raised its price target to $225 from $210. The reason? Google Cloud is on fire. After meeting with 20 CEOs at CES and the Needham Growth Conference, analysts came away even more bullish, hiking their Q4 2024 revenue forecast to $96.4 billiona 12% jump year-over-year. But the real kicker? Cloud revenue got a 7% boost to $12.1 billion, nearly doubling its expected operating income to $2 billion. And lets not forget Googles advertising juggernautraking in over $260 billion last year and still commanding more than 40% of global digital ad spend.
Looking ahead, the momentum isnt slowing. Needham now sees Alphabet pulling in $390.2 billion in total revenue for 2025 and $435.8 billion in 2026, each growing around 12% annually. YouTube remains the undisputed king of streaming in the U.S. and the top dog in social video advertising, while AI is set to drive even more demand for Google Clouds services. Needham analysts are crystal clearAlphabet isnt just another tech giant; its operating in a winner take most market. Even if regulators force a breakup, the parts might be worth more than the whole.
Now, all eyes are on Alphabets Q4 earnings drop on February 4 post-market. Wall Street is penciling in $2.12 EPS on $96.67 billion in revenue. With analysts raising targets and Alphabet firing on all cylinders, investors betting against this tech titan might want to rethink their strategy.
This article first appeared on GuruFocus.