5 Best Technology Stocks to Buy for Long Term

3. Alphabet Inc. (NASDAQ:GOOGL)

Number of Hedge Fund Holders: 205

Alphabet Inc. (NASDAQ:GOOG) is an American technology conglomerate and the parent company of Google. Alphabet is involved in the business of information technology, computing and biotechnology. 

Alphabet Inc has a low risk profile as far as investment goes. The company boasts a D/E ratio of 5.8% and a current ratio of 2.87 as of the first quarter of 2022. The analyst sentiment surrounding Alphabet is also favorable. 

On June 2, Piper Sandler analyst Thomas Champion lowered the price target on Alphabet Inc. to $2,775 down from $2,900 and kept an ‘Overweight’ rating on the stock. On May 28, AI Root wrote in the then Barron’s edition that stocks like Alphabet and Meta are bargain stocks to buy now amid the market downturn. The analyst noted that although investors are rightly concerned during such downturns to avoid “picking up a dud” but there are opportunities amid the rubble and says Alphabet and Meta are discount buys at the moment.

Here is what Vulcan Value Partners had to say about Alphabet in their investor letter from the last quarter of 2021. 

“In contrast, we made a different kind of mistake about a decade ago. Google, now Alphabet Inc. (NASDAQ:GOOG), performed very well for us while we owned it. The company kept outperforming our assumptions and we kept lowering them to be conservative. “Trees do not grow to the sky.” The stock kept going up and our value grew but did not keep pace with the stock. It hit our estimate of fair value and we sold it with a nice gain, patting ourselves on the back. We kept following the company and what they actually did over the next several years was roughly double the assumptions we used to value it. Therefore, our value was too conservative, and we sold it too cheaply, missing many years of compounding. Fortunately, we experienced some volatility several years ago that allowed us to purchase Alphabet Inc. (NASDAQ:GOOG) (Google) again with a margin of safety.”

Apart from the search engine Google, the company provides other services on the software side, most prominent of which include Chrome (the most popular web browser), Adwords for web advertisement, Google Cloud, Android operating system (the default operating system in over 3 billion smartphones and tablets) and video sharing application Youtube with 2.6 billion active users.

On the hardware side, two of its most popular business lines include Google Pixel and Google Nest. Alphabet designs and manufactures laptops, smartphones, tablets and earbuds among other accessories through its Google Pixel business-line. Through its Google Nest business-line, it provides hardware solutions like smoke detectors, smart thermostats, wireless routers, smart media players and displays and speakers etc. 

Alphabet Inc. (NASDAQ:GOOG) also owns and operates Verily, a biotechnology research & development lab with various biotech products to offer.