Alphabet CEO Sundar Pichai at the Google I/O developer conference on May 10, 2023 in Mountain View, California.
David Paul Morris | David Paul Morris Bloomberg | Getty Images
letter The company’s shares rose 10% on Friday morning after the company reported better-than-expected first-quarter results and approved its first dividend and $70 billion in buybacks.
The company reported revenue of $80.54 billion on Thursday, a 15% annual increase, the fastest growth since the beginning of 2022, and surpassed the $78.59 billion in sales expected by analysts polled by LSEG. Earnings of $1.89 per share beat Wall Street expectations of $1.51 per share.
Alphabet announced that its board of directors authorized the payment of a dividend of 20 cents per share on June 17 to all shareholders of record as of June 10, and stated that it intends to pay future quarterly cash dividends. The company said its board also approved repurchasing an additional $70 billion worth of stock.
The company’s YouTube ad revenue and Google Cloud revenue exceeded analysts’ expectations.
Barclays analysts maintained an overweight rating on Alphabet shares and raised their target price to $200 from $173, praising the company’s balance of investments with efficiency and capital returns.
“Google is in the best position to accelerate growth, expand profits, deliver products faster and return capital — essentially proving the naysayers wrong,” they wrote in a note Thursday. “The momentum is here. It should stay strong for a while.”
Oppenheimer analysts, who focus on Alphabet’s advertising business accelerating despite heavy investments in artificial intelligence, raised their price target to $205 from $185 and reiterated an outperform rating.
Morgan Stanley analysts maintained their overweight rating on Alphabet and raised their price target to $195 from $165, citing the company’s core growth durability and “early success in durable redesign of its cost base.”
Other price target hikes on the stock following Alphabet’s earnings include JPMorgan raising its price target to $200 from $165, while Evercore ISI raised its price target to $200 from $160.
—CNBC’s Michael Bloom contributed to this report.
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