3. Alphabet Inc. (NASDAQ:GOOG)
Number of Hedge Fund Holders as of Q4: 234
In October 2024, Mark Cuban praised Alphabet Inc. (NASDAQ:GOOG)’s AI model, Gemini, emphasizing its ability to integrate seamlessly across Google Workspaces and continuously learn to improve efficiency. He stated, “There are two kinds of companies: those that are great at AI and everybody else.” Cuban believes Gemini enhances productivity by saving employees time, improving work quality, and assisting businesses in areas like finance and marketing where they may lack expertise. He has also participated in Google events, such as the Gemini at Work event in New York City, further underscoring his support for the company.
Alphabet Inc. (NASDAQ:GOOG) recently reported strong fourth-quarter earnings, posting earnings per share of $2.15 on revenue of $96.47 billion, surpassing analysts’ estimates of $2.13 per share. This represents a significant increase from the previous year’s Q4 earnings of $1.64 per share on $86.3 billion in revenue. CEO Sundar Pichai reaffirmed the company’s commitment to innovation, announcing plans for approximately $75 billion in capital expenditures for 2025, with a primary focus on generative AI.
As Alphabet Inc. (NASDAQ:GOOG) continues to advance its AI capabilities, it sees artificial intelligence as a transformative opportunity to solidify its market leadership. Google Cloud, a key component of Alphabet’s AI-driven strategy, posted a 30% year-over-year revenue increase in Q4 2024, reaching $11.9 billion. Alphabet’s deep expertise in AI positions it as a formidable player in cloud computing, further strengthening its competitive edge in an evolving technological landscape.
Alphabet Inc. (NASDAQ:GOOG) plays a key role in the AI arms race, offering its generative AI model, Gemini, which boasts a strong user base. Alphabet has seamlessly integrated it into Google Search, strengthening its core business. The company continues to invest heavily in AI to meet growing demand, but its stock recently experienced a selloff due to broader tech market weakness. This dip presents a potential buying opportunity, as Alphabet remains attractively valued at 19.5 times forward earnings. Given its AI-driven growth, investors may find this a strategic moment to capitalize on the company’s long-term potential.
The London Company Large Cap Strategy stated the following regarding Alphabet Inc. (NASDAQ:GOOG) in its Q4 2024 investor letter:
“Alphabet Inc. (NASDAQ:GOOG) – GOOG was a top performer this quarter reflecting strong results from its ad business, Cloud growth, and margin enhancements. Investors got some clarity on the antitrust lawsuits during the quarter, but potential outcomes from these cases remain uncertain. Margins in the core business continue to improve, and growth in the Cloud business accelerated. Management has executed its expense control plans and expanded margins through better product and process organization. GOOG has a solid balance sheet, significant market share, and generates strong returns on invested capital.”
