Bank of America Says Alphabet’s Q2 Will Deliver; Sets $440 Price Target
Ahead of Alphabet's Q2 2026 earnings report, Bank of America has issued a bullish outlook, setting a price target of $440, implying 19% upside from the current $369.68. The article highlights Google Cloud's 63% growth, outpacing Microsoft Azure's 40%, and a cloud backlog nearly doubling to $462 billion. However, capital intensity is a concern, with CapEx more than doubling to $36 billion in Q1, slashing free cash flow by 47%. Prediction markets assign a 96.6% probability of another earnings beat. The bull case rests on cloud, AI monetization (Gemini processing 16 billion tokens per minute), and Waymo's 500,000 weekly autonomous rides. The bear case focuses on rising costs and regulatory fines. Comparisons are drawn with Microsoft and Meta, noting Alphabet's lower P/E ratio of 25.
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