Can Google Stock Add $1 Trillion To Its Value?

Google’s shareholders had reason to cheer this week, as the stock climbed 11% on the heels of a major legal win: a federal judge ruled that Google won’t be required to sell its Chrome browser as an antitrust penalty — removing one of the biggest overhangs facing the tech giant.

Why This Matters More Than You Think

Let’s be clear — losing Chrome would have been disastrous for Google. This isn’t just another product in its lineup. Chrome sits at the core of Google’s model, acting as the gateway that directs billions of users to Google search and, ultimately, its advertising engine. The browser’s value to Google? We’ve estimated it in the trillions. It’s no surprise investors welcomed news that this asset remains intact.

Still, the ruling wasn’t a clean sweep for Google. Judge Amit Mehta added guardrails, including a ban on exclusive search agreements like the lucrative arrangement with Apple. Even so, Google can continue to strike deals that set Chrome as the default browser — a key distinction that preserves much of Chrome’s strategic value.

Separately, see important current market context – S&P 500 Index To Crash 8%?

Image by DWilliam from Pixabay

Not Out of the Woods Yet

Before declaring victory, remember there’s another major case pending. A separate US court ruled last year that Google illegally monopolized online search and advertising markets, with a final verdict due on September 10. That’s less than a week away and could still carry meaningful consequences.

Regulatory risk is only one part of the broader framework we use when building the Trefis High Quality (HQ) Portfolio, a 30-stock collection with a history of comfortably outperforming the S&P 500 over the last 4-year period. Why is that? As a group, HQ Portfolio stocks have delivered stronger returns with less volatility than the benchmark, as shown in the HQ Portfolio performance metrics.

The Valuation Story Gets Interesting

From an investment lens, this is compelling. Google has traded at a notable discount to Big Tech peers, largely due to regulatory uncertainty. While Amazon trades at 35 times trailing earnings, and Microsoft at 37 times, Google was sitting at just 25 times as of yesterday’s close.

That gap is hard to justify given the fundamentals. Google has been executing well — solid revenue growth, better profitability margins, and leadership in search and cloud. The regulatory overhang has been the key force keeping the multiple suppressed.

Here’s the kicker: If Google’s multiple were to expand to 37 times — in line with Amazon and Microsoft — the stock could top $350, implying roughly 50% upside from current levels. That would add over $1 trillion to market value — not just a lift for shareholders, but a fundamental re-rating of one of the world’s most profitable companies.

That said, a re-rating likely hinges on clarity from the September 10 ruling. And to be fair, there are still meaningful risks that could weigh on performance, which we detail in our separate analysis on Google’s Valuation, Growth Drivers, and Key Risks.

The Bottom Line

Yesterday’s decision looks like a turning point for Google’s stock. Operationally, the company has been strong, yet the shares traded at a discount because of regulatory fears. With one major threat now removed, investors are beginning to price in the possibility that Google’s multiple could start to converge with peers.

Google isn’t fully in the clear — that September 10 verdict still looms — but this development suggests the worst-case scenarios may be fading. For a business executing well yet weighed down by regulatory baggage, this is exactly the kind of catalyst that can unlock significant value. See our view in GOOG Stock To $400?

Learn more about Trefis HQ strategy that has outperformed its all-cap stocks benchmark (a combination of the S&P 500, S&P mid-cap, and Russell 2000), delivering strong returns for investors.

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