Should I buy Google shares after Stifel raised its price target to $2,350?

Written by: Stanko Iliev
April 7, 2021
  • Google shares are trading near record levels
  • Stifel raised its price target to $2350 on Google
  • Google shares remain expensive

Alphabet Inc (Google) shares are trading near record levels, and as long the price is above $2000, there is no risk of the trend reversal.

Fundamental analysis: Stifel raised its price target to $2350 on Google

Even in this pandemic environment, the company’s business is going well, and the price of the stock is trading near record levels. While the company’s growth prospects are good, Google has grown its U.S. digital ad revenue slower than the overall market.

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According to the latest news, Amazon has increased its digital ad market share, and this gain appears to be coming from Google. Google has around 28.9% U.S. digital ad market share, while it is expected to decrease below 27% by 2023 year.

The data comes from a new report from research firm eMarketer that also reported that the online shopping demand accelerated during the COVID-19 pandemic. The positive news is that the company announced last week that some U.S. employees could return to the office in the upcoming days.

“In the United States, the situation is also mixed, and we must continue to stay vigilant to prevent a new wave of the virus. We also see some hopeful improvements in parts of the country. I’m happy to say that over the next month, it is likely we’ll begin to welcome Googlers back to some of our U.S. offices on a voluntary basis,” said Chief People Officer Fionna Cicconi.

During the pandemic, the speedy recovery of Google’s business has “impressed” analyst firm Stifel, which assigned a buy rating with a price target of $2,350.

“We view Alphabet’s advertising businesses (Search & other, YouTube, Network) as primed to benefit from category recovery in COVID-19 impacted industries as well as maintained share capture from categories such as retail that saw more favorable demand in 2H:20,” Stifel reported.

Still, with a $1.50T market capitalization, Google shares remain expensive, and if the U.S. stock market enters a more significant correction phase, the share price could be at much lower levels.

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Technical analysis: Bullish trend remains intact

Google shares are trading just a couple of dollars below their record levels, and the first sign of the trend reversal could be if the price falls below the $2000 support level.

Data source: tradingview.com

If the price jumps above $2300 resistance, it would be a signal to trade Google shares, and the next target could be around $2350. On the other side, if the price falls below $2000, it would be a firm “sell” signal, and the next target could be around $1900 or even $1800.

Summary

Alphabet Inc (Google) shares are trading near record levels, and as long the price is above $2000, there is no risk of the trend reversal. Stifel raised its price target to $2350 on Google, but with a $1.50T market capitalization, Google shares remain expensive.