Google’s parent company Alphabet has become an unstoppable force in the artificial intelligence field, according to Pivotal Research Group. Analyst Jeffrey Brodarczak reiterated his Buy rating on Alphabet on Friday, citing continued momentum in the company’s core business areas and saying Google appears to be “winning everywhere” across the AI stack. Wrodarczak raised his price target from $350 to a street high of $400, suggesting the stock could rise nearly 26% from its recent close. The average analyst price target compiled by LSEG is $309.96, suggesting the stock may be overvalued after recent gains and a decline of more than 3%. Wlodarczak believes that Google’s Gemini model could pose a clear threat to OpenAI. He expects Gemini’s market share gains relative to OpenAI to continue to grow at an accelerated pace, and said that given the scale of its commitments, “OpenAI could be at risk of having to exit capex” in 2026. Google’s latest AI model outperforms OpenAI’s ChatGPT on several important large-scale language model metrics, and Sam Altman earlier this week declared a “Code Red” effort to improve ChatGPT as competition heats up. “Google appears to be best positioned among its peers to monetize its AI investments both internally and externally,” the analyst said in a note to clients. “Search is a resilient cash cow with pricing power, a powerful driver of GOOG’s best-in-class Gemini AI, and an opportunity to leverage AI to drive huge costs out of search businesses,” he continued. “We also highlight that as Gemini AI steals search share (primarily from the AI itself), the sharing economics with phone manufacturers will drop dramatically (Apple actually pays for access to Gemini), which also contributes to search margins.” Investors Gemini 3 Alphabet shares have risen 13% over the past month, far outpacing the performance of the Magnificent Seven over the same period, as the company celebrates the success of its AI models and the growth of its own chip business. The stock price has increased about 70% since the beginning of the year. GOOGL 1Y Mountain Google Stock Performance. In addition to AI model capabilities, Google can leverage the benefits of AI and Tensor Processing Unit (TPU) chips to accelerate cloud computing market share and profitability, Wlodarczak said. He added that TPU chips are significantly cheaper than Nvidia’s graphics processing units and cloud competitors’ GPUs. Google’s TPU business “remains a huge opportunity, although it still has only 15-20% industry penetration for global workloads, and rising server costs (mainly due to significantly higher memory costs) are likely to accelerate this process,” he said.
