UBS Cuts Alphabet Price Target to $379
UBS analyst Stephen Ju lowered the price target on Alphabet (NASDAQ: GOOGL) to $379 (from $400) while maintaining a Neutral rating.
“This quarter there were fewer reasons to cheer with Search and Cloud growth roughly in line (vs beats 1Q26) alongside the company flagging two margin drags vs the 2Q26 level: 1) stepped up CapEx intensity for 2026 (which also drives up our 2027 estimate) and 2) ongoing higher hiring needs (with SBC coming in hotter than we anticipated).
As such, our gross revenues change marginally for 2027E and 2028E, but our costs go up faster by ~2% and ~3%, respectively.
We have been fielding more questions on Google about FCF growth returning to historic levels, and after today’s update (where revenue is largely unchanged but costs work higher) we have no clearer answers.
In fact we worry that CapEx for 2027 might climb further from here out as input costs rise and Google continues to invest in frontier model training, and that exacerbates potential for downward revisions to organic EPS (ex mark to market on equity investments).
Given the near peak multiple and more likely downward vs upward revision to EPS, we think the risk reward skew remains more favorable on AMZN.
We reduce our price target by $21 to $379 and maintain our Neutral rating.”
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