Alphabet Secures $1.375B Settlement with Texas, Projects Promising Upside for Stock

Alphabet's Google has settled a $1.375 billion data privacy lawsuit with Texas. The settlement is the largest in Google's history regarding state data privacy issues. Analysts project a 31.21% upside potential for Alphabet Inc stock, with an average one-year price target of $200.42. GuruFocus values Alphabet Inc at $195.79, suggesting a 28.18% upside from its current market price.

Alphabet Inc.'s (NASDAQ: GOOGL) Google unit has reached a $1.375 billion settlement with the state of Texas to resolve allegations of unlawful data collection practices. This settlement, announced by Texas Attorney General Ken Paxton, is the largest in Google's history regarding state data privacy issues. The agreement, reached in principle, marks a significant step forward in protecting Texans' data privacy and security rights [1].

The settlement comes after Texas filed a case in 2022, alleging that Google violated state laws by tracking and collecting user data through services such as incognito searches. This latest settlement surpasses the previous largest settlement, which was a $93 million deal with California in 2023. In 2022, Google also settled a $391 million case with 40 U.S. states over data collection practices [1].

The settlement is expected to have a positive impact on Alphabet Inc. stock. Analysts project a 31.21% upside potential for the stock, with an average one-year price target of $200.42. GuruFocus values Alphabet Inc. at $195.79, suggesting a 28.18% upside from its current market price [2].

Despite the settlement, Google faces potential challenges from competitors like Apple, which is actively exploring AI-powered search alternatives. Apple's senior vice president of services, Eddy Cue, testified that the company is "actively looking at" reshaping the Safari web browser to focus on AI search engines. This development could threaten Google's dominance in web searches, which account for more than half of Alphabet's total revenue [2].

In conclusion, the $1.375 billion settlement with Texas represents a significant milestone in Google's data privacy efforts. While the settlement is positive for Alphabet Inc. stock, the company must also navigate the potential threat posed by competitors' AI search technologies.

References:
[1] https://seekingalpha.com/news/4446135-google-inks-1375b-settlement-texas
[2] https://finance.yahoo.com/news/why-alphabet-stock-plummeting-today-175703241.html