Seeking Alpha downgraded Alphabet Inc. to a 'Hold' rating. The firm cited a full valuation after the stock price nearly doubled over the past year.
Valuation multiples reached multi-decade highs. The analysis noted a weakening free cash flow yield, which dropped to 1.8%.
Extensive capital expenditures on Artificial Intelligence infrastructure caused the FCF yield drop.
The long-term growth story remains intact, driven by AI, YouTube, and Waymo. However, near-term price appreciation outpaced business fundamentals.
Technical trading momentum is fading, coupled with heavy insider selling. The analysis concludes the risk/reward profile now favors waiting for a more attractive entry point. Analysts anticipate the stock may rest in 2026.