10 Best Major Stocks to Buy According to Hedge Funds

4. Alphabet Inc. (NASDAQ:GOOGL)

No. of Hedge Fund Holders: 202

Alphabet Inc. (NASDAQ:GOOGL) operates as a holding company and operates through subsidiaries. The company offers web-based searches, advertisements, software applications, enterprise solutions, commerce, and hardware products.

On February 5, Needham analyst Laura Martin maintained a price target of $225 on GOOGL shares, maintaining a Buy rating. Analysts believe that Alphabet Inc.’s (NASDAQ:GOOGL) growing cloud business makes it a promising stock. Martin remains bullish on the stock as the company posted strong revenue growth of 12% year-over-year in Q4 2024. The company revenue was mainly driven by robust performance in Google Search and Cloud. During Q4, Alphabet Inc.’s (NASDAQ:GOOGL) Cloud and YouTube businesses generated over $110 billion in combined annual revenue. The company’s cloud business experienced a 30% revenue increase, driven by strong demand for AI-powered solutions and strategic deals over $1 billion.

Alphabet Inc.’s (NASDAQ:GOOGL) cloud business and UiPath Inc. (NYSE:PATH) are collaborating to help customers transform their enterprises with AI-powered automation. Oakmark Funds stated the following regarding Alphabet Inc. (NASDAQ:GOOGL) in its Q4 2024 investor letter:

“Alphabet Inc. (NASDAQ:GOOGL) was the top contributor during the quarter. Despite ongoing litigation with the Department of Justice in its antitrust case, the U.S.-headquartered interactive media and services company’s stock price rose after posting solid third-quarter earnings. In the Search division, the company generated low-teens year-over-year revenue growth and management highlighted that they’re seeing strong user engagement with their new AI Overviews feature. The biggest upside surprise came from the Cloud division, where revenue growth accelerated to 35% and margins reached a record of 17%. This performance was driven by client demand for AI Infrastructure and Generative AI Solutions as well as core Google Cloud Platform (GCP) products. We continue to believe Alphabet is a collection of great businesses that can unlock further value over the long term through its world-class AI capabilities.”