July 3 – Alphabet (NASDAQ:GOOGL) could unlock massive shareholder value by spinning off its divisions, D.A. Davidson said in a Wednesday note.
The broker pegs Google Cloud Platform alone at about $56 per share, arguing that a full breakup would make GOOGL the top mega?cap pick, according to the note. Analysts there compare GCP’s feature set to a blend of Microsoft (NASDAQ:MSFT), Snowflake (NYSE:SNOW), CrowdStrike Holdings (NASDAQ:CRWD), Cloudflare Inc (NYSE:NET) and Nebius Group (NASDAQ:NBIS). They forecast GCP revenue of roughly $55 billion this year.
D.A. Davidson highlights GCP’s use of Google’s Tensor Processing Units alongside Nvidia (NASDAQ:NVDA) architecture as a cost edge for AI workloads. Despite seasonal softness in June, developer activity remains strong across Compute Engine, Vertex (NASDAQ:VRTX), BigQuery and Cloud Storage. A potential Wiz security acquisition could further strengthen GCP’s competitive position.
In sum?of?the?parts analysis, D.A. Davidson values a fully separated Alphabet at about $312 per share. Yet the firm keeps its 12?month target for GOOGL at $160, noting uncertainty over any structural overhaul. Investors will be watching whether Alphabet’s management moves to unlock this latent value.
This article first appeared on GuruFocus.
