7 Undervalued Blue Chip Stocks To Buy Right Now

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1. Alphabet Inc. (NASDAQ:GOOG)

Analyst Upside Potential: 25.41%

Forward P/E, as of September 24: 18.62

Number of Hedge Fund Holders:  165

Ranking 1st in our list of the 7 undervalued blue chip stocks to buy right now is Alphabet Inc. (NASDAQ:GOOG). Alphabet Inc. (NASDAQ:GOOG)’s Q2 2024 results were driven by robust growth in its Google Cloud segment, which expanded by 28%. Its core search business remains resilient despite macroeconomic headwinds. A key driver of Alphabet Inc. (NASDAQ:GOOG)’s future growth is its substantial investment in AI, particularly through its Bard AI platform and enhancements to its cloud computing capabilities. This positions Alphabet Inc. (NASDAQ:GOOG) as a frontrunner in the rapidly evolving AI sector, which is expected to transform various industries and create new revenue streams.

With a forward P/E ratio of 18.62 and a market capitalization exceeding $2 trillion, Alphabet Inc. (NASDAQ:GOOG)’s strong balance sheet provides it with the flexibility to continue investing in innovation while navigating economic uncertainties. Its leadership in digital advertising further reinforces its revenue-generating capabilities, making it well-equipped to adapt to changing market dynamics.

Overall, Alphabet Inc. (NASDAQ:GOOG)’s combination of strong financial performance, strategic investments in AI, and leadership in digital services supports a bullish outlook, positioning it favorably for long-term growth and investor value creation.

Parnassus Growth Equity Fund stated the following regarding Alphabet Inc. (NASDAQ:GOOG) in its Q2 2024 investor letter:

“Alphabet Inc.’s (NASDAQ:GOOG) stock rose on the strength of robust first-quarter revenue growth underpinned by noteworthy gains in search advertising, YouTube advertising and the cloud business. Signs that the company is accelerating its development of AI solutions buoyed investor optimism.”

While we acknowledge the potential of Alphabet Inc. (NASDAQ:GOOG), our conviction lies in the belief that under the radar AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. If you are looking for an AI stock that is more promising than the ones on our list but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: $30 Trillion Opportunity: 15 Best Humanoid Robot Stocks to Buy According to Morgan Stanley and Jim Cramer Says NVIDIA ‘Has Become A Wasteland’.

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