BTC-1.67%
Market Analysis
Alphabet Stock (GOOG) Dips in Premarket Amid Antitrust Breakup Threat
The U.S. Justice Department is reportedly considering breaking up Google to address antitrust concerns.
Editorial disclosureRead more
All reviews, research, news and assessments of any kind on The Tokenist are compiled using a strict editorial review process by our editorial team. Neither our writers nor our editors receive direct compensation of any kind to publish information on tokenist.com. Our company, Tokenist Media LLC, is community supported and may receive a small commission when you purchase products or services through links on our website. Click here for a full list of our partners and an in-depth explanation on how we get paid.
The U.S. Justice Department is considering recommending that Google-owner Alphabet (NASDAQ: GOOG) be forced to sell off parts of its operations in what has been called a “landmark antitrust case.”
This move is a potential remedy to address the tech giant’s alleged monopolization of the online search market. The case, currently in its remedy phase, follows a ruling that Google violated antitrust laws in both online search and search text ads markets.
Google and DoJ’s Antitrust Strategy
The Justice Department filed a court document on Tuesday, October 8, 2024, outlining potential remedies against Google. Judge Amit Mehta, who is overseeing the case, is expected to hold a trial on proposed remedies in spring 2025, with a final decision anticipated by August 2025.
The DoJ is weighing both behavioral and structural remedies, including forcing Google to provide access to underlying data used for search results and AI products.
At the heart of DoJ’s case is the belief that Google gained unfair advantages through illegal distribution agreements with other tech companies, making its search engine the default option on smartphones and web browsers.
The department aims to prevent Google from leveraging products like Chrome, Play, and Android to advantage its search and search-related products over competitors.
A Google Breakup Will Be a Historical Event for Antitrust Enforcement
If successful, this would mark the first company breakup for illegal monopolization since the unsuccessful attempt to dismantle Microsoft (NASDAQ: MSFT) two decades ago. The case represents a significant shift in antitrust enforcement against big tech companies and could set a precedent for future actions in the industry.
As news of the potential breakup spread, Google’s stock (GOOG) showed signs of volatility. In pre-market trading as of 5:33 AM EDT, GOOG was down 1.25% to $163.63, following a previous close of $165.70 at the time of writing.
Despite the current dip, the stock has shown strong performance over the past year, with a 19.73% return, though still underperforming the S&P 500’s 33.48% gain.
Alphabet Inc., Google’s parent company, maintains a substantial market capitalization of $2.031 trillion, with a P/E ratio of 23.77 and earnings per share of $6.98.
Analyst recommendations remain mixed, with some rating it as “Outperform” or “Strong Buy,” and an average price target of $198.85, suggesting potential upside despite the ongoing antitrust concerns.
Disclaimer: The author does not hold or have a position in any securities discussed in the article.
Tim Fries
Tim Fries is the cofounder of The Tokenist. He has a B. Sc. in Mechanical Engineering from the University of Michigan, and an MBA from the University of Chicago Booth School of Business. Tim served as a Senior Associate on the investment team at RW Baird's US Private Equity division, and is also the co-founder of Protective Technologies Capital, an investment firm specializing in sensing, protection and control solutions.
