From Nasdaq:

Alphabet, the parent company of Google, saw a rapid rise in stock value in 2023 after initial concerns about its ability to compete with new AI developments from OpenAI and Microsoft. The company released competitive AI products in response. Upcoming releases like Google Bard and Google Gemini show that Alphabet is well-prepared to continue leading the AI industry.

A majority of Alphabet’s revenue comes from Google Search, but other assets within the company offer promising potential. For instance, YouTube continues to attract billions in advertising revenue, while Google Cloud, while historically unprofitable, is now recording a slightly positive operating margin and should continue growing.

Alphabet has seen a 55% increase in its stock value over the past year, leading investors to question its future value. Despite currently trading at the same average price-to-earnings ratio as the S&P 500, the company is positioned to grow its earnings per share at 15% for several years. This makes Alphabet a strong investment for 2024.

While Alphabet stock has increased significantly in the past year, its forward growth potential, especially in AI, YouTube, and Google Cloud, make it an attractive investment for 2024 with 15% EPS growth expected. Investors should consider the company’s response to AI developments and its other assets.

Compounded with the growth potential of AI, YouTube, and Google Cloud, Alphabet’s stock is a strong investment for 2024 with a 15% expected EPS growth. The company’s competitive position and response to AI developments show its readiness to continue leading the sector. The company also continues to show resilience in its AI ventures with a 90% market share for Google Search.



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