Why Alphabet Stock Fell Today

Source The Motley Fool

Alphabet (NASDAQ: GOOGL)(NASDAQ: GOOG) stock ended Thursday's trading session in the red. The company's share price fell 1.4% in a day of trading that saw the S&P 500 (SNPINDEX: ^GSPC) rise 0.1% and the Nasdaq Composite (NASDAQINDEX: ^IXIC) fall 0.1%.

Alphabet stock swung from being up as much as 1% to down as much as 3% as investors reacted to differing catalysts. While a pair of new analyst price targets suggested there was still significant upside for the stock, shares moved lower following news that the company had received an unfavorable antitrust ruling.

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Alphabet stock initially rose on new price targets

Before the market opened this morning, Morgan Stanley published new coverage that reiterated its overweight rating on Alphabet. While the firm lowered its one-year target on the stock from $210 per share to $185 per share, the new target still suggested roughly 20% upside compared to its price when the market opened today.

Truist also published new coverage on the stock today, maintaining a buy rating but lowering its one-year target from $220 per share to $200 per share. At market open, Truist's new target implied 30% potential upside.

The stock fell after a monopoly ruling on Alphabet

U.S. District Judge Leonie Brinkema ruled today that Alphabet was responsible for intentionally building and sustaining a monopoly in the digital ad-network space. Alphabet said that it would be appealing the ruling, and that its success in the digital ads market was the result of its tools being "simple, affordable, and effective."

Today's court filing raises the chances that Alphabet could spin off its Google advertising network, but the nature of the appeals process suggests that the move would likely take years to play out.

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Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Keith Noonan has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet and Truist Financial. The Motley Fool has a disclosure policy.

Disclaimer: For information purposes only. Past performance is not indicative of future results.
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