In what could be a blow to Alphabet (GOOGL) stock, two European startups are rising up in an attempt to challenge Google. Founded in France, Qwant is a privacy-focused search engine that claims it doesn’t track its users. German search engine Ecosia is a not-for-profit company that has committed its profits to planting trees and generating renewable energy. Now, these two companies are joining forces to create a European search index that could threaten the tech giant’s dominance.
Don't Miss out on Research Tools:
- Discover the latest stocks recommended by top Wall Street analysts, all in one place with Analyst Top Stocks
- Make smarter investments with weekly expert stock picks from the Smart Investor Newsletter
What’s Happening with Alphabet Stock
So far, this news out of Europe hasn’t impacted Alphabet stock. Shares closed out trading today up 1% and continued rising in after-hours trading. Over the past quarter, the tech leader has enjoyed mostly steady growth, rising 11% over the past three months. Wall Street sentiment towards it remains positive as Alphabet prepares to end the year.
That said, Google may have a formidable opponent if Qwant and Ecosia’s partnership continues to develop. Both startups are focused on helping drive innovation, particularly with regards to generative AI, while also looking to reduce the industry-wide dependence on Google and Microsoft (MSFT)’s Bing. It has been dubbed the European Search Perspective and is based in Paris.
Ecosia CEO Christian Kroll spoke to WIRED about what they hope to accomplish with this project, stating, “We could derank results from unethical or unsustainable companies and rank good companies higher.” The outlet notes that under it, users could be given search results that better serve the missions of their companies. This could certainly provide an incentive for users to break away from relying on Google and Bing.
Wall Street Remains Highly Bullish on Alphabet Stock
So far, Wall Street doesn’t seem overly concerned with this potential threat out of Europe. Analysts have a Strong Buy consensus rating on GOOGL stock based on 27 Buys and seven Holds assigned in the past three months, as indicated by the graphic below. After a 38% rally in its share price over the past year, the average GOOGL price target of $207.75 per share implies 14% upside potential.
