ChatGPT Stock Advice: 10 Recent Stock Recommendations

4. Alphabet Inc. (NASDAQ:GOOG)

Number of Hedge Fund Holders: 216

In a recent legal development, a judge ruled that Google violated antitrust laws by abusing its monopoly in the market, particularly through an exclusive deal with Apple. However, some argue that this ruling is outdated and fails to consider the rapidly evolving landscape of AI in search technology.

The possibility of a Alphabet Inc. (NASDAQ:GOOGL) breakup has sparked discussions about its impact on the company’s stock and overall structure. Gene Munster, a tech analyst, believes that if an announcement were made about breaking up Google, the stock could potentially rise by 5% or more, unlocking up to 20% of its value. However, he also estimates the likelihood of such a breakup at around 15%.

Dan Ives, Managing Director of Equity Research at Wedbush Securities suggests that the current antitrust challenges will likely result in business model adjustments rather than full-scale breakups. While these issues are more than just minor inconveniences, they are not expected to significantly disrupt the core operations or profitability of these tech giants. Interestingly, Ives notes that if companies like Amazon, Apple, and Google were to be broken up, the sum of their individual parts might actually be worth more than their current stock prices—a paradox in the ongoing antitrust debate.

Alphabet Inc. (NASDAQ:GOOGL) experienced significant growth in Q2 2024, with a 15% year-over-year revenue increase and a 31% rise in diluted EPS. The Google Cloud Platform (GCP) grew nearly 29% YoY, strengthening its position in the cloud market. Despite a recent 14% drop in its stock price, Alphabet Inc. (NASDAQ:GOOGL) is valued at 20-25x FY2024 earnings, indicating a potential buying opportunity. Analysts have set a price target of $203.74, projecting a 25.03% upside as of August 16. Although regulatory challenges and AI competition pose risks, Alphabet’s strong data capabilities and innovation provide resilience.