Alphabet’s (NASDAQ:GOOGL) potential acquisition of HubSpot (NYSE:HUBS) would enhance its product portfolio and give it a competitive edge. HubSpot provides customer relationship management (CRM) platform, so acquiring it would expand Google’s range of enterprise-oriented products and applications.
Last month, Stifel analyst Mark Kelley, an analyst ranked amongst the top 1% of Street stock experts (To watch Josey’s track record, click here), noted that integrating HubSpot’s CRM suite with Google’s productivity and advertising tools could enhance Google’s platform capabilities. The five-star analyst noted that this deal would offer a viable alternative in the market, although it would not match the full-scale enterprise offerings of Microsoft (NASDAQ:MSFT) and Salesforce (NYSE:CRM).
A Reuters report pointed out that Google is already competing with Microsoft’s Office suite through its Google Workspace collaboration tools. Acquiring HubSpot would further position Google as a competitor in the CRM space, challenging Microsoft’s Dynamics 365 products.
HUBS Acquisition to Face Regulatory Hurdles
While speculation is that Google is moving ahead to acquire HubSpot, it has yet to confirm the same. Moreover, analysts fear that the deal could face regulatory headwinds.
Analysts from RBC Capital, Evercore ISI, and Oppenheimer expressed concerns and stated that they see regulatory challenges for the deal. In April, RBC Capital analyst Brad Erickson said that the combination will make Alphabet more competitive against rivals like MSFT and Amazon (NASDAQ:AMZN). However, he added that the regulatory challenges would prevent the deal from happening.
It remains to be seen whether GOOGL will proceed with the acquisition. Meanwhile, let’s look at the Street’s forecast for Alphabet stock.
Is Alphabet Stock a Buy, Sell, or Hold?
Alphabet stock is up over 42% in one year. Further, analysts are bullish about its prospects, given the company’s efforts to integrate artificial intelligence (AI) into its offerings.
Alphabet stock has 31 Buys and five Hold recommendations for a Strong Buy consensus rating. Analysts’ average price target on GOOGL stock is $197.17, implying 13.61% upside potential from current levels.
