Alphabet (NASDAQ:GOOGL) has been on quite a roll over the past few months, chalking up a number of wins on both the business and regulatory sides of the ledger.
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The company’s top-line growth speaks for itself, with Q2 2025 revenues rising by 14% to reach $96.4 billion. The gains were spread out among many of Alphabet’s businesses, and CEO Sundar Pichai was certainly standing on firm ground when he declared that the company “had a standout quarter.”
Another boost arrived in early September, as a U.S. District Judge Amit Mehta ruled that the company would not need to divest its Chrome web browser. The decision lifted a large regulatory overhang from the company, and sent GOOGL’s share price higher still.
While some of GOOGL’s shine dimmed last week amid heavy NASDAQ losses on Friday, the company’s share price is still up over 30% for the last three months.
Investor Motti Sapir is more than ready to acknowledge the company’s past performance, though he finds himself asking whether the price makes sense after the recent bull run.
“To really move the stock from here, Alphabet probably needs to show either new sources of revenue from AI or a much bigger shift in the overall market mood, and neither of those is guaranteed,” cautions the investor.
Beyond its traditional search primacy, Sapir notes that Alphabet is riding plenty of AI-related momentum. For instance, the company has already integrated Gemini into Search, YouTube, Gmail, and Android.
“That’s not just flash. These tools are starting to shape how users interact with Google every day,” adds Sapir.
However, the investor also points out that there are some challenges coming up on the horizon. These include regulatory hurdles related to the company’s advertising business, rising competition from other hyperscalers, and increasing AI-related costs.
All in all, though Sapir is feeling “comfortable” with GOOGL’s current valuation, he also doesn’t think the time is right for newcomers to jump on board.
“If you already own shares, there’s no reason to sell. But if you’re thinking about buying, it makes more sense to wait,” sums up Sapir. “Alphabet is worth owning, just not chasing.”
It’s therefore a Hold (i.e. Neutral) rating from Sapir. (To watch Motti Sapir’s track record, click here)
Wall Street remains fairly bullish about GOOGL. With 30 Buys and 8 Holds, GOOGL enjoys a Strong Buy consensus rating. Its 12-month average price target of $254.00 implies an upside of ~7%. (See GOOGL stock forecast)
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Disclaimer: The opinions expressed in this article are solely those of the featured investor. The content is intended to be used for informational purposes only. It is very important to do your own analysis before making any investment.