"Our view, which we iterated in various notes published in August, October, and November of 2024, as well as in February, April, and July of 2025, was largely ratified by Justice Mehta's judgment. We had previously highlighted that the likely remedies would be behavioral in nature. At the same time, even the imposition of these remedies is not immediate, with an Alphabet appeal to this case likely elongating the process by a few years."
"We maintain our $237 fair value estimate as our base-case outlook, as the antitrust opinion published today largely upholds our outlook. With shares jumping 7% following the decision, we now view Alphabet as fairly valued, with the stock up more than 50% from its April lows. We believe that with this crucial remedies opinion out of the way, Alphabet can focus more clearly on its search business while aggressively integrating artificial intelligence features."
Justice Mehta's proposed remedies in the Google Search antitrust case bar Alphabet from exclusive search agreements and require modest competitor data sharing while not mandating divestiture of Chrome or Android. The remedies are behavioral rather than structural, reducing immediate corporate value risk. An Alphabet appeal is likely, which could extend implementation by several years and allow the evolving search market to dilute remedies' impact. Shares rallied about 7% on the judgment, with the stock up over 50% from April lows. The maintained fair value estimate of $237 reflects a base-case outlook that anticipates continued focus on search and accelerated AI integration.
Read at www.morningstar.com
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