Alphabet Shares Surge on AI Breakthrough and Revised Analyst Targets

A significant advancement in artificial intelligence from Google’s parent company, Alphabet, has sent its stock soaring and appears to have put rival OpenAI on high alert. The launch of the new Gemini 3 model, reported to substantially outperform ChatGPT 5.1, has triggered a wave of bullish analyst upgrades, though substantial insider selling introduces a note of caution.

Stellar Quarterly Performance Sets the Stage

The recent analyst optimism is built upon a foundation of strong financial results. For the third quarter, Alphabet reported earnings per share of $2.87, decisively beating the consensus estimate of $2.29. Revenue climbed to $102.35 billion, exceeding forecasts of $99.90 billion. The cloud division was a particular standout, posting year-over-year growth of 34%.

Wall Street Responds with Aggressive Price Targets

In the wake of the AI announcement, investment banks have moved swiftly to adjust their valuations. HSBC analyst Paul Rossington raised his price target to $370 from $335, maintaining a “Buy” rating and implying an upside of approximately 16%. Other firms were even more optimistic: Arete Research established a new target of $380, while Guggenheim set its objective at $375. The consensus among these analysts is that Alphabet has seized a leadership position in the AI race, creating a valuation gap the market has yet to fully price in.

Gemini 3 Triggers “Code Red” at OpenAI

The source of the market excitement is the purported capability of Alphabet’s Gemini 3 AI model. Industry reports suggest it significantly surpasses the performance of OpenAI’s ChatGPT 5.1. This development is said to have prompted OpenAI CEO Sam Altman to declare an internal “Code Red,” accelerating the development of a counter-model reportedly codenamed “Garlic.”

Should investors sell immediately? Or is it worth buying Alphabet?

The breakthrough highlights two specific potential revenue streams for Alphabet:
* TPU Sales: Revenue from Google’s Tensor Processing Units could reach ten percent of Nvidia’s volume by 2030.
* Strategic Agreements: Meta has reportedly expressed interest in Google’s TPU infrastructure, pointing to a potentially highly lucrative deal.

Insider Selling Contrasts with Market Euphoria

Despite the positive sentiment from analysts, transaction data reveals a degree of caution among some major holders. Granite Investment Partners reduced its stake by 3.8% in the second quarter, while Westfield Capital sold off 25.7% of its position. More notably, corporate insiders—including CEO Sundar Pichai—have sold shares worth approximately $58 million over the past 90 days.

Whether these sales represent routine portfolio management or signal apprehension about the sustainability of the stock’s rally remains an open question. The divergence between bullish external analysis and insider share disposals presents a key consideration for prudent investors evaluating Alphabet’s current trajectory.