9 AI Stocks Investors Are Monitoring

1. Alphabet Inc. (NASDAQ:GOOGL)

Number of Hedge Fund Holders: 202

Alphabet Inc. (NASDAQ:GOOGL) is an American multinational technology conglomerate holding company wholly owning the internet giant Google, amongst other businesses. On February 3^rd, Reuters reported that the company will be facing scrutiny over its massive AI spending after it reports its earnings today, after markets close. This is because revenue growth likely slowed in the holiday quarter due to a slowdown in its advertising and cloud businesses. Alphabet has been facing scrutiny after the emergence of Chinese startup DeepSeek, which has claimed to launch low-cost AI models and caused investor concerns over huge AI investments, power needs, and valuation risks. According to LSEG, Alphabet’s capital expenditure is estimated to have been $50 billion last year. It is anticipated to be even higher in 2025 to support its cloud expansion and AI-driven search features. These are important to defend its market share and attract more ad revenue. On the other hand, Google Cloud growth is expected to slow down in the fourth quarter amid high expectations.

“Although (the cloud unit’s) rate of growth is expected to slow, elevated investment is expected to continue, but efficiency gains have so far kept profits buoyant. Sustaining this balancing act will be a critical and investors will want to see evidence of this”.

-Susannah Streeter, head of money and markets, Hargreaves Lansdown.

While we acknowledge the potential of GOOGL as an investment, our conviction lies in the belief that some 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 GOOGL but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: 20 Best AI Stock To Buy Now and Complete List of All AI Companies Under $2 Billion Market Cap.

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