Citi’s Top Analyst Bullish on Alphabet Stock as Legal Headwinds Ease - Here’s Why
Alphabet's legal clouds are parting—and Citi's sharpest minds are taking notice.
The regulatory pressure that's haunted Big Tech? It's lifting. Alphabet's navigating the legal maze with surprising agility, turning courtroom battles into potential market advantages.
Why analysts are shifting stance
Citi's top brass sees clearer skies ahead. The legal overhang that suppressed valuation multiples? Dissipating. No dramatic numbers to share—just a fundamental recalibration of risk assessment as regulatory uncertainties diminish.
The bottom line: When legal threats recede, cash flow projections shine brighter. Alphabet's dominance in search and cloud suddenly looks less constrained—more room to run, fewer regulatory handcuffs. Another reminder that in finance, sometimes the best gains come from risks that never materialized.
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But Chrome wasn’t the only matter at stake. The court also reviewed the legality of Alphabet’s payments to Apple for keeping Google as the default search engine on iPhones. The arrangement is a win-win, giving Alphabet unparalleled access to users and search volumes, while Apple enjoys a steady stream of payments.
Even so, Mehta’s decision doesn’t mean Alphabet can put its legal troubles behind it entirely. The company and the Department of Justice must still work out how to apply the ruling, and the appeals process could stretch on for years.
Still, Citi’s Ronald Josey, an analyst ranked in the top 1% amongst the thousands of Wall Street stock experts, sees the resolution as a turning point, one that allows the company to accelerate innovation and push forward with its product roadmap.
“The net result, in our view,” says Josey, “is an accelerated product development cycle that is beginning to emerge with greater Gemini adoption across both its Ads and Cloud businesses.”
His confidence was bolstered after a call with attorney Seth Ottensoser of Morgan & Morgan, who suggested that any eventual remedies are more likely to be “behavioral than structural.” In plain terms, Alphabet might face new rules of conduct, but it isn’t likely to be broken up.
That outlook, combined with the prospect of a business-friendly TRUMP administration, points to a more manageable regulatory backdrop. With fewer clouds hanging over it, Alphabet can lean into its next growth driver: Gemini.
Josey highlights Gemini’s integration with AI Mode, which has already surpassed 100 million monthly users. He believes this momentum will feed directly into Google Cloud growth as enterprises adopt AI-powered tools.
“Given our continued healthy online advertising trends and greater Google Cloud demand, we are raising our revenue projections for 3Q and beyond,” adds the analyst, who assigns GOOGL a Buy rating and raises his price target to $280 – about 11% higher than current levels. (To watch Ronald Josey’s track record, click here)
Most of Josey’s peers feel the same way. With 28 Buys and 9 Holds, GOOGL enjoys a Strong Buy consensus rating. However, its 12-month average price target of $235.97 suggests that GOOGL’s recent upswing went a bit farther than even some bulls had anticipated. (See)
