Transcript
0:00 >> I appreciate you, Steve. Thanks for jumping on with us. Right at the top of our show, Steve Liesman, our senior economics reporter. Now turning to the other big story today, a mega move from Megacap Google after its big antitrust win. Dan Ives is global head of technology research with Wedbush. He joins us now. It's good to see you. Quite obviously, given this ruling, is it the outcome that you expected? >> Yeah, I mean, look, this is we talked about it. I think this DOJ was always the bark was going to be worse than the bite. I think it's the dream scenario for Google. It's the dream scenario for Apple.
0:32 Because now they really get unleashed from an M&A perspective as well as ultimately what I and you look at that search deal I mean, you know, this is now I believe going to be really the next stage of growth for Google as well as Apple. >> I mean, were you fearing the worst outcome possible here? Where did that sort of percolate, you know, inside of your thoughts as you were waiting, like many investors were, for a decision?
1:00 >> Yeah, Scott, I'd say the last year, like we've talked to so many investors hand-holding through this and we continue to believe that ultimately this is probably going to be the scenario. We didn't see a breakup. We didn't see Chrome selling up. We didn't see anything from an Apple perspective that was going to ruin that relationship from a 20 billion in terms of search. But I think it speaks to the point, like, look, the Beltway versus big tech, it's going to continue to be a battle. It doesn't end here. But for Google, it's a champagne moment because now they're going to be unleashed, especially when it comes to AI. That goes from a headwind now to a Tailwind.
1:35 >> Well, investors are popping the corks to to play that forward. Obviously today, given the biggest move in the stock since April, do you think for the stock it closes the valuation gap here forward because it does trade at a reasonable discount to its mega-cap peers? >> Yeah. We raised price target 245. But but ultimately you know and me and my colleague Scott David have talked about it. I mean this could be a $300 stock because now it you're going to start to see the multiple expand. You take now the DOJ overhang the antitrust.
2:09 I now think Apple and Google you know potentially could start to walk down the aisle in terms of a bigger Gemini partnership from an AI perspective and look, and I think this is one it was like it was a hated name. And I get all that, you know, in terms of the risk. But now I think many are sort of underweight or, you know, not enough. And I think this is a stock that could have a three in front of it as we go into the next six months.
2:34 >> I mean, a hated name is a bit of an overstatement, probably given. I mean, if you look at the chart, what was concern around the name has become? I think, relief. I mean, the stock had rallied a good amount coming into this, so let's not act like it was universally hated. I'm talking about alphabet, of course, before we break out the caviar. Also, to go with the champagne that you're ready to pop, this does not really address the bigger picture issue for alphabet, does it? In terms of the threat of losing its absolute dominance as it relates to search because of I.
3:06 >> Look, we talked about it last quarter. I mean, if you look at search and you look at all the data, look, I'm not saying there's not a headwind there, but I actually believe they're going to ultimately turn this into just really what's going to be a massive transformation opportunity search. If you look at it, it's going to continue to see strength like we saw the last few quarters. It's holding up Rock of Gibraltar. Like I'm not going to say that down the road.
3:31 You're not going to have some maybe softness. But ultimately now you start to focus on Gemini, the AI piece that ultimately is really going to, I think, be a significant catalyst to the name. I continue to think that that was way overdone in terms of some of the fears. They're proving it day by day. Now, the DOJ thing, you know, that's in the rear view mirror. I mean, look, this is this is kind of a dream scen