Some of Google and YouTube parent company Alphabet’s (NASDAQ:GOOG, NASDAQ:GOOGL) critics might claim that Alphabet is still playing catch-up in the generative artificial intelligence ( ) arms race. Yet, GOOG stock investors shouldn’t worry too much. Alphabet is relentlessly pushing the gen-AI envelope with new and upgraded products on a global scale.
Like it or not, generative AI is here to stay and will be a dominant theme in 2024. Investors should have at least some exposure to this market. So, today is a perfect day to consider adding shares of Alphabet to your portfolio before the price goes higher in 2023’s final months.
GOOG Stock Isn’t Outrageously Expensive
Just because Alphabet is a “Magnificent Seven” company with a rising share price, this doesn’t mean GOOG stock is too expensive to buy now. All year long, the skeptics and short-sellers have been wrong and Alphabet’s path to a $2 trillion market capitalization is inevitable.
Remember, this isn’t the year 2000, when mega-cap technology stocks were drastically overpriced. Alphabet actually has a trailing price-to-earnings (P/E) ratio of around 25x. We’re not talking about a triple-digit P/E ratio here, so don’t assume that Alphabet is too richly valued.
Besides, Alphabet’s value to the shareholders can grow over the coming quarters because the company keeps on improving its products. For example, Google’s gen-AI chatbot, Bard, got off to a very rough start earlier this year. Today, however, Bard is much better and its quickly gaining traction.
Furthermore, Google Product Lead Jack Krawczyk recently suggested that Bard is on a path to garnering 2 billion users. The company, according to a Reuters reports, plans to enhance Google Assistant with Bard’s human-directed suggestions.
Krawczyk explained that connecting Bard with Google Assistant will introduce AI to more people. It shouldn’t be long now, as consumers can expect Bard-enhanced Google Assistant to be available on mobile phones in the coming months.
Alphabet Takes Gen-AI to 120+ Countries
If there’s any doubt that Alphabet is poised to be a global leader in gen-AI, here’s a development which will quash that doubt. Through its Search Generative Experience (SGE) product, Google is now rolling out a gen-AI search experience to more than 120 countries and territories.
Moreover, Google is adding support for four new languages for SGE. This moves comes after successful SGE launches in India and Japan.
On top of all that, Google is tweaking SGE to make it better. In particular, the company is trying out new ways to allow users to ask follow-up search questions. Also, Google is working on eliminating ambiguity and adding more context to translations in SGE.
Naturally, gen-AI will help Google achieve these objectives and continue to dominate the search engine market. Clearly, Alphabet is constantly striving to improve its products and maintain its competitive moat.
GOOG Stock: $150 Is a Cinch
What will the Alphabet share price be at the end of 2023? I’d say at least $150, but don’t get hung up on short-term price targets. Think long-term as Alphabet’s value comes from the company’s relentless pursuit of better tech products.
Alphabet is taking gen-AI global and working hard to maintain its edge in the lucrative search engine market. So, don’t obsess too much over P/E ratios and don’t let the skeptics change your mind. Just consider a position in GOOG stock as it’s likely to move higher, not only in the last two months of 2023 but throughout 2024 as well.
On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.