Alphabet’s Google stock (NASDAQ: GOOG) opened Friday’s trading session at $369 and is struggling to maintain its balance this month. The tech titan had reached a high of $408 in May and remained in reverse gear since then. The continuous slide is a cause of worry as traders fear it could slip back below the $300 level. The fears stem as GOOG rose from $293 to $408, running on the back of the previous earnings call.
Now that the revenue call is ironed out, the equity remains at the mercy of the market. The broader US market is under macroeconomic pressure stemming from the US-Iran talks and the rising oil prices. Add to the woes the skeptical thesis on Alphabet’s huge $185 billion in capex to build its AI infrastructure. Wall Street is in no mood to support the spending without seeing actual gains. This has affected Google’s stock prospects and is caught in the crosshairs of the development.
Despite the fears, global investment bank Wells Fargo Securities has given Google stock a ‘strong buy’ call. Ken Gawrelski, managing director and senior Equity analyst at Wells Fargo Securities, wrote in a note to clients that GOOG is on its way to climb above the $400 threshold. He also gave it an Overweight rating, expressing confidence in the company. Buying GOOG now at the $360+ level could still stand a chance to reap the profits.
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What Is Wells Fargo Securities Google Stock Price Prediction?
Wells Fargo Securities’ analyst Ken Gawrelski has predicted Google stock to reach a high of $435 next. That’s another 18% from its current price and has the potential to deliver double-digit gains. An investment of $1,000 could turn into $1,180 if the price prediction for GOOG turns out to be accurate. This comes when GOOG is struggling to cement its place above the $400 level.
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Gawrelski backed his price prediction on the growing demand for Google Cloud enterprise. He highlighted the massive $462 billion backlog, which would outweigh its spending on building its AI infrastructure. He also explained that to meet the surging customer demand, Alphabet will be forced to shift nearly 60% of its internal computing capacity over to Google Cloud. A move, he says, will only benefit Google stock, as it is a catalyst to increase its revenues.