Alphabet Inc’s (GOOGL) I/O Conference Showcases Improved Developer-Friendly Direction: Wells Fargo

Last week, Google parent company Alphabet Inc (NASDAQ:GOOGL) hosted its annual I/O developer conference, where the industry giant presented its future goals. Wells Fargo analyst Peter Stabler strongly believes Alphabet is implementing solid plans to grow and to solve key issues it is facing.

Therefore, Stabler reiterates an Outperform rating with a price target of $1150, which represents an upside of nearly 19% compared to where the shares last closed.

“In our view, at I/O, the company: 1) provided answers to key investor questions regarding the future of search […] in the face of changing human/computer interaction models […], 2) addressed Android fragmentation […], a key issue for app developers and, ultimately, for Android users, and 3) opened developer access to Google Assistant, which we believe should increase both developer engagement with Google tools and consumer exposure to Assistant,” comments the analyst.

“Google began to assemble a cogent response to such concerns at I/O,” Stabler continues, commending Alphabet for its future plans to take on human/computer interaction models. This is a particularly important update for investors who believe voice-based search could possibly harm the company’s ability to sustain visual-based results, as well as advertising. The analyst pinpointed the introduction of visual responses to Google Home-initiated voice search, which he considers a “potential for GOOGL to continue to respond to commercial queries with a visual user experience that should continue to prominently feature advertising.”

Another takeaway for Stabler from the I/O conference is Alphabet’s intent to tackle Android fragmentation with its Project Treble, which would speed the process of Android updates, making for a more developer-friendly, smoother ecosystem.

Additionally, Alphabet is introducing many innovations using Artificial Intelligence (AI) while expanding Google Assistant access to third-party apps and devices. The tech giant even added Google Assistant to the company’s Android Things IoT platform, which Stabler cheers as a savvy step forward in the right direction.

Bottom line, the analyst firmly believes “these moves as likely to increase developer engagement with the Android ecosystem and Google cloud tools, as well as driving consumer exposure to Google AI.”

According to TipRanks, a financial engine that measures and ranks analysts’ and bloggers’ performance, Peter Stabler is ranked #195 out of #4554 analysts. Stabler has an 82% success rate and generates an annual yield of 24.1%. When recommending GOOGL, the analyst earns a 14.5% average profit on the stock.

TipRanks analytics show GOOGL as a Strong Buy. Based on 26 analysts offering recommendations for this share, 21 issue a Buy and 5 maintain a Hold. The 12-month average price target stands at $1052.86, making a nearly 9.21% upside from where the stock is currently trading.

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