Investing.com - Citi maintained its Buy rating on Alphabet (NASDAQ: GOOGL ) stock Tuesday while raising its price target to $203 from $200, citing positive channel checks for both Search and YouTube.

The research firm noted that while Search and YouTube remain central to most media buying plans, marketers are increasingly aware of evolving search behaviors among users, with ChatGPT reaching approximately 603 million monthly active users in May compared to Gemini’s 77 million.

Advertisers expressed optimism about Google’s AI offerings, including AI Overviews, AI Mode, and AI Max for Search, highlighting improved click-through rates. The firm also mentioned positive reception to Gemini, particularly the new Gemini 2.5 Flash-Lite, which could benefit ad creative and the evolution toward Keywordless Targeting.

YouTube continues to demonstrate strength with over 1 billion hours watched daily on TV screens and a 12.5% share of U.S. total viewing time. Citi was impressed that YouTube Shorts now generates over 200 billion daily views, up from approximately 70 billion reported in September 2023, with new features like Veo 3 launching for Shorts this summer.

Based on these positive indicators, Citi raised its 2025 and 2026 revenue projections for Google by 1.3% and 2.1% respectively, while maintaining its approximately 20x 2026 P/E valuation methodology that resulted in the new $203 price target.

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