We’ve recently released a compilation of
10 Stocks That Have Wall Street’s Attention Right Now
In this piece, we will examine how Alphabet Inc. (NASDAQ:GOOG) measures up against other stocks currently being discussed on Wall Street today.
Gene Muster from Deepwater Asset Management said in a recent interview with CNBC that investors should take a “targeted” approach while investing in major tech companies and look for “pockets” of opportunities.
“I think that when you answer the question more holistically, there’s still—if you look at, uh, we looked at 20 different companies, tech companies, and their reporting season and graded each of them—and of the six Mag Seven, five of the six we gave an A grade, and so there’s still this outperformance that you’re seeing with the fundamentals on these companies, but that doesn’t mean that the best opportunities to invest is necessarily with them, and so again, more of a targeted approach.”
Munster also discussed several prominent technology firms and indicated his belief that Jensen Huang’s artificial intelligence semiconductor company remains “undervalued” regarding its share price. Nonetheless, the analyst recommended that investors consider looking into lesser-known businesses instead.
“You have to be uh strategic in terms of what you’re buying. If you wanted to buy a basket, I would buy a basket of smaller tech companies, sub 500 billion dollars, and focus on those. It’s probably where your bigger outperformance is.”
In this piece, we’ve selected 10 stocks that are actively trading on Wall Street. For each stock listed, we’ve included information about how many hedge funds hold positions in them. We focus on these particular stocks because our analysis indicates that following the leading choices made by successful hedge funds allows us to beat the broader markets. Each quarter, our monthly publication features a portfolio consisting of both small-cap and large-cap stocks—comprising 14 selections—and since May 2014, this approach has yielded returns amounting to 373.4%, surpassing its index benchmark by an impressive margin of 218 percentage points.
see more details here
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.
Alphabet Inc. (NASDAQ:
GOOG
)
Number of Hedge Fund Investors: 160
During a recent interview on CNBC, Ben Reitzes, Melius Research Head of Technology Research, talked about the “existential threats” Alphabet is facing related to its search business.
“We compared it to Kodak in terms of the innovator’s dilemma, where your eyes saw digital cameras coming and the digital revolution. It didn’t matter if it was really ready for prime time that exact second, but you knew it was coming. Eventually, it caught up with you, and the existential threat did come to bear there in the worst way possible. That’s not going to be really the case for Alphabet Inc (NASDAQ:GOOG), because they could break up and they have a lot of great assets. But nonetheless, it does remind us of the innovator’s dilemma. They don’t really know what to do; they’re experimenting here, experimenting there. Actually, nobody even knows what’s going on. The regular search, we think, is being disrupted by AI very clearly though, and they’ve got to make a bet soon.”
Alphabet delivered robust quarterly performance, yet the market still shows hesitation regarding the stock because of potential threats to its search operations from advancements in AI technologies such as ChatGPT. Nonetheless, supporters of Alphabet Inc. (NASDAQ:GOOG) argue that these worries are exaggerated.
Google has an edge over competitors because it’s easier for the billions of users of its search engine to switch to Gemini instead of opting for a completely new model. Google has over 1.5 billion monthly users interacting with its AI-powered Search overviews. OpenAI, Alphabet’s biggest competitor now when it comes to AI search, has less than 5% of its users paying, and its business model is still developing. Google’s first-quarter results showed continued strength in its cloud unit, with revenue up 28% year over year and solid operating income growth. This supports Google’s broader AI strategy and underscores the scale advantages of its cloud business.
The market is also ignoring Alphabet Inc (NASDAQ:GOOGL)’s key secondary businesses and the stock remains undervalued despite concerns around AI search and regulatory onslaught.
Alphabet Inc (NASDAQ:GOOGL)’s secondary ventures in AI, autonomous driving, and other areas are making solid progress, especially in the Waymo robotaxi segment. Waymo vehicles now average about 30.6 autonomous rides per day—substantially higher than Uber’s average of 4.18 rides per driver daily, based on Uber’s 31 million daily trips and 7.4 million drivers last quarter. This performance underscores Waymo’s competitive edge in autonomous ride volume compared to traditional ride-hailing.
The Mairs & Power Balanced Fund made the following comments about Alphabet Inc. (NASDAQ: GOOG):
Q1 2025 investor letter
:
The fund’s investments in the Communications Services sector negatively impacted the portfolio returns for the quarter mainly because of poor stock picking.
Alphabet Inc.
(NASDAQ:GOOG) led underperformance as it fell in tandem with the other mega cap tech stocks. Additionally, there is increasing concern about the impact of generative AI on Alphabet’s search business and whether it will be able to meaningfully respond.”
Overall, GOOG
ranks 4th
on our list of stocks Wall Street is talking about these days. While we acknowledge the potential of 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 time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than GOOG but that trades at less than 5 times its earnings, check out our report about this
cheapest AI stock
.
READ NEXT:
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Disclosure: None. This article is originally published at
Insider Monkey
.
