Trefis analysts think Alphabet could have a $500 stock by the end of the decade.
That’s what Trefis analysts think Alphabet (GOOGL -0.04%) (GOOG 0.03%) could be a $500 stock by 2030. That prediction comes from an op-ed published in Forbes in October, and implies an upside of just over 200% from the current stock price of $162. If this proves correct, shareholders would earn an annual return of approximately 20% over the next six years.
Wall Street also expects Alphabet to move higher in the near term. Of the 68 analysts covering the company, the lowest 12-month price target of $170 per share implies an upside of 5%. In other words, no analyst thinks the stock will decline over the next twelve months. Of course, there’s no such thing as a guarantee when it comes to the stock market, but the optimism is notable nonetheless.
Here’s what investors need to know about Alphabet, and what it could take for its stock price to reach $500 by 2030.
Alphabet should benefit as the digital advertising and cloud computing markets expand
The investment thesis for Alphabet is based on its strength in advertising and cloud computing, two markets that are expected to grow rapidly. Specifically, eMarketer expects digital ad spending to grow 10% annually through 2028, and IDC estimates that public cloud spending will grow 19% annually over the same period, driven by high demand for artificial intelligence (AI) platform services ).
Alphabet is the market leader in digital advertising with a 27.4% revenue share. This figure is expected to drop by half a percentage point next year Amazon and other competitors are gaining ground. But Alphabet has a material advantage because it owns six products with more than 2 billion monthly users, including Google Search and YouTube. These popular platforms engage consumers and create data that supports ad targeting.
Importantly, Alphabet is leaning on its AI expertise to defend its leadership in digital advertising. CEO Sundar Pichai says generative AI overviews on Google Search drive usage and improve user satisfaction, especially among people aged 18 to 24. The company also debuted more than 30 new AI features for its ad tech software last quarter to streamline workflows and improve campaign results.
Finally, Alphabet operates the third largest public cloud in Google Cloud Platform. While the company Amazon and Microsoft The power of its AI infrastructure and large language models have more than contributed to the company gaining a percentage point of market share over the past year. “Google’s Gemini combines a world-class model with enterprise cloud services,” said Forrester research.
Alphabet has an overlooked opportunity in its autonomous taxi company Waymo
Analysts at Trefis pointed to autonomous driving subsidiary Waymo as a key reason why Alphabet could be a $500 stock by 2030. Investors often overlook that part of the business, but the robotaxi market is expected to grow 67% annually through 2030, according to Straits Research. And Alphabet is well positioned to be a big winner.
Waymo was the first company to operate an autonomous taxi service and now offers more than 100,000 rides per week in Phoenix, San Francisco and Los Angeles. To add to this, Waymo has partnered with Uber to bring its ride-hailing platform to Atlanta and Austin by 2025. Analysts at Bank of America I estimate that Waymo’s revenue could reach $75 million this year, an insignificant amount, but that figure could grow rapidly in the future.
Anecdotally, I recently visited San Francisco and had the opportunity to use the Waymo app. The experience was seamless and the technology was impressive. The Waymo vehicle was quite careful while navigating the busy city streets with pedestrians, but was also assertive when necessary. I have never been more sure that robotaxis is the future.
What would it take to have a $500 stock in 2030?
Investors should be aware of regulatory risk. A federal judge ruled in August that Google had engaged in illegal practices to maintain its search monopoly. The Justice Department has proposed solutions ranging from restrictions to a break. But the judge won’t make a final decision until August 2025, and appeals could drag out the process for years.
Importantly, while the Justice Department has proposed a forced divestment of the Chrome browser or Android operating system, some legal experts believe the eventual solution will be less severe. They say the most likely outcome is that Alphabet will be banned from operating companies such as Apple for default placement in search engines, according to CNBC.
With that in mind, Wall Street expects Alphabet’s earnings to grow 15.6% annually through 2027, making its current valuation of 23 times earnings seem reasonable. Assuming the company’s earnings grow at the same pace through 2030, Alphabet’s share price would reach $500 if the stock traded at 30.7 times earnings. That would be a material premium over current valuation, which seems unlikely more than six years from now.
That said, Alphabet’s revenues could grow faster than analysts expect if Waymo becomes a meaningful source of profit. In that context, a stock price of $500 is not out of the question. Either way, patient investors should feel confident buying a small position in this stock today.
Bank of America is an advertising partner of The Ascent, a Motley Fool company. Suzanne Frey, a director at Alphabet, is a member of The Motley Fool’s board of directors. John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Trevor Jennevine has positions at Amazon. The Motley Fool holds positions in and recommends Alphabet, Amazon, Bank of America, Microsoft and Uber Technologies. The Motley Fool recommends the following options: long January 2026 $395 calls to Microsoft and short January 2026 $405 calls to Microsoft. The Motley Fool has a disclosure policy.
