Alphabet: Shares Trading 13%-35% Below Fair Value
Summary
- My sum of the parts analysis suggests Alphabet may be undervalued by 13% to 35%. I moved my $200 price target from year-end to the end of Q3.
- For the valuation analysis, I use EV/Sales and I compare Alphabet’s segments to the closest matches at Amazon, Microsoft, Snapchat, and Meta.
- There is a big risk to my bull case: the ongoing antitrust trial could trigger a selloff if the remedies decision expected by August 2025 is unfavorable for Alphabet.
- I still own June 27, $180 strike price, call options. I may roll them out depending on price action, as the expiration date is uncomfortably close.
Analyst’s Disclosure:I/we have a beneficial long position in the shares of GOOGL either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
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