If Alphabet (GOOG,GOOGL) solves a huge problem that it’s facing, GOOG stock’s current levels will eventually be seen as “the steal of the century,” LightFolio founder Landon Swan told Schwab Network recently.
A user’s hands typing a search query into a Google Search box, emphasizing the company’s search capabilities.
Alphabet’s Big Problem
A significant number of individuals have been going to ChatGPT or other AI models for answers to questions instead of Google, Swan explained. As a result, Alphabet added AI data at the top of its search results.
However, the latter innovation is preventing many users from clicking on Google’s ads, cutting into Alphabet’s revenue, according to Swan. But if Alphabet can solve this issue, the current price of its shares will eventually be seen as “the steal of the century,” Swan stated.
Swan Is Upbeat on Google Cloud, Alphabet’s Investments
Alphabet’s revenue from its cloud products grew by an impressive 30% last quarter versus the same period a year earlier, the investor noted. He’s also upbeat about its decision to raise its expected 2025 capital expenditure level to about $75 billion from its previous outlook of $59 billion.
“I think that (Alphabet) has to make big investments in tech and AI to ensure that it’s not surpassed by ChatGPT,” he explained.
While we acknowledge the potential of GOOG, our conviction lies in the belief that AI stocks hold greater promise for delivering higher returns, and doing so within a shorter timeframe. 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.
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Disclosure: None. This article is originally published at Insider Monkey.