Alphabet Shares Reach New Milestone Amid Growing AI Enthusiasm
Alphabet Inc. has seen its shares close at $200 for the first time this past Friday, signaling a bullish outlook among investors regarding the company's potential in artificial intelligence (AI).
The stock rose by 1.1% on that day, concluding the week with a gain of over 2% to reach a price of $200.21. Since the beginning of the year, shares have climbed nearly 6%, outpacing the Nasdaq's gain of 3.3%.
This achievement marks a significant milestone on a split-adjusted basis, following Alphabet's implementation of a 20-for-1 stock split in 2022. Before the split, the stock was trading around $2,750, which translated to $137.50 per share after the adjustment.
As tech giants gear up to report their earnings next week, Alphabet is set to release its fourth-quarter results on February 4, following announcements from Microsoft, Meta, and Tesla on Wednesday, and Apple on Thursday.
In the third quarter, Alphabet's revenue grew by 15% compared to the same period the previous year, an increase from the 11% growth seen in the third quarter of 2024. The company reported $88.3 billion in sales during this quarter and also achieved record revenue from its cloud services.
Despite facing heightened competition in the generative AI space—largely driven by advancements from OpenAI—analysts remain optimistic about Google's standing in the AI sector. They note the company's continuous improvements across its various product offerings.
Morgan Stanley analysts recently highlighted Alphabet's advancements with its AI agent projects, including Project Astra and Project Mariner, as well as the rollout of its language model, Gemini 2.0, in 2024. Nonetheless, the firm acknowledged that significant challenges remain in scaling consumer products.
During a strategy meeting held last month, Google executives stated that they anticipate a competitive year ahead, marked by regulatory challenges and ongoing AI developments. The second half of 2024, in particular, showcased many significant AI products after a somewhat rocky start.
In the past year, Alphabet's shares have surged by 35%. Among major tech companies, Nvidia stands out with a remarkable 132% increase, while Tesla follows closely with a 96% rise. Other firms such as Meta and Amazon have performed better than Alphabet, while Apple and Microsoft have seen less favorable results. Overall, the Nasdaq has appreciated by 29% during the same period.
Conclusion
As Alphabet continues to push the boundaries of artificial intelligence and enhance its product suite, investor interest appears to be growing stronger, reflected in the company's stock performance.
Alphabet, AI, Stocks