Google parent company Alphabet Inc advanced nearer to joining peers Apple Inc and Microsoft Corp in the elite $2 trillion market valuation club on Wednesday as the search giant's shares surged more than 8% following a blowout quarterly report.
Last trading at about $2,975, Alphabet's stock was on track for its largest one-day percentage gain in almost two years, easing concerns around owning Big Tech following a sector-wide selloff in the past few weeks.
Alphabet's stock market value peaked just above $2 trillion after the start of the trading session, and was last at $1.97 trillion. That includes class B shares that do not trade on the stock market and are held by insiders.
A close above $2 trillion would be the first ever for the Mountain View, California-based company.
"The technology sector started 2022 with some of the biggest question marks over it since the dotcom crash more than two decades ago," said Russ Mould, investment director at AJ Bell. "However, the largest and highest quality US tech names continue to deliver the answers the market wants with big earnings beats."
Shares of Wall Street's most valuable companies have soared in the past two years, driven by pandemic-led shifts in how people work and learn, even as regulators around the world scrutinize them over allegations of breaches of privacy and antitrust concerns.
At least 20 brokerages raised their price targets on Alphabet's stock after the company late on Tuesday delivered record quarterly sales that topped expectations. The median analyst price target is now $3,450, 16% above its current price.
Big Tech stocks, benchmark S&P index are down this year
Alphabet also announced a 20-to-1 stock split, which will give shareholders 19 shares for every share they hold.
Splitting stocks is a method companies use to woo investors by making them more affordable. However, some brokerages, such as Robinhood Markets, allow investors to buy fractions of shares, making the tactic less effective.
Tesla Inc and Apple split their stocks in 2000 to make their shares more appealing to mom-and-pop investors.
"The split will make the shares more accessible for retail investors and likely facilitate inclusion in the Dow Jones Industrial Average (which is somehow still share price-weighted), but it has no fundamental impact," J.P. Morgan analyst Doug Anmuth said.
Facebook parent Meta Platforms, which is set to report results on Wednesday after the bell, was last up 1.1%.
Adding to the rebound in tech stocks, Advanced Micro Devices Inc's shares jumped over 5% after its results topped Wall Street expectations. Rivals Nvidia Corp, Qualcomm Inc and Micron Technology Inc also rose.
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