Artificial intelligence boom driving 55% increase in S&P 500, Alphabet well-positioned

From Nasdaq: 2025-01-07 04:30:00

The stock market has seen a surge with a 55% increase in the S&P 500 in the last two years due to the artificial intelligence (AI) boom. Experts compare AI to transformative inventions like the microprocessor, PC, and internet, with AI expected to boost productivity across industries.

AI agents are gaining traction on Wall Street, with a projected 45% annual market increase through 2030. Alphabet is well-positioned to benefit from this trend, with a competitive stock price. AI agents are capable of handling complex tasks and are expected to augment human workforces in the future.

Alphabet, a leader in AI cloud services, is leveraging its expertise to create new monetization opportunities in advertising and cloud businesses. Google’s cloud computing division is recognized as a leader in AI infrastructure solutions, machine learning platforms, and large language models. The company is gaining market share in cloud services as enterprises adopt agentic AI solutions.

Spending on public cloud services is expected to rise annually, with a faster growth rate projected for artificial intelligence platforms like Google’s Vertex AI. With a reasonable valuation and strong growth potential, Alphabet is a top AI stock pick for long-term investors. The company’s earnings are estimated to increase at 16% annually in the next three years.

Investors should consider the potential for significant returns in the top 10 stocks identified by The Motley Fool Stock Advisor analyst team. Alphabet may not be on the list, but past recommendations like Nvidia have shown substantial growth. Stock Advisor provides a blueprint for success with regular updates and new stock picks each month, outperforming the S&P 500 since 2002.



Read more at Nasdaq: A Once-in-a-Decade Investment Opportunity: My Pick for the Best AI Stock to Buy in 2025