Google’s Parent Owner Alphabet is Now a Trillion Dollar Company

Now there are three. Wall Street has a new $1 trillion dollar darling.

Shares of Google’s parent company Alphabet were soaring on Thursday to a new all-time high and helping the company see a
new market value of $1 trillion.

Now Apple, Microsoft, and Alphabet are the three stocks on Wall Street that are worth at least $1 trillion. Apple leads the pack with a market value of almost $1.4 trillion and Microsoft is right behind with almost $1.3 trillion.

Shares of Alphabet are already up more than 8% this year and are up over 34% in the past year.

UBS has now raised its price target on Alphabet after it topped $1 trillion. The firm sees Alphabet’s stock soaring over 15% this year and has raised its price target from $1,460 to $1,675 based on valuation considerations.

UBS analyst Eric Sheridan has asked, “Is GOOG still a cheap stock?”

According to UBS, applying an 18x EV/GAAP EBIT multiple to Alphabet’s core Google operating estimates in 2021 already yields a share value of $1,662 and in the process, assigns a zero to negative value to Alphabet’s Other Bets.

The firm also believes Google Cloud is a promising long-term opportunity for the company as it builds scale.

“We believe the current valuation does not give full credit to [Alphabet’s] scale advantages, the potential for better capital allocation and cost efficiencies, or its cash balance (reflecting uncertainty over future shareholder returns and regulatory overhangs),” UBS wrote.

Disclaimer: We have no position in Alphabet Inc Class A (NASDAQ: GOOGL) and have not been compensated for this article.