Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) dominates the U.S. search-engine market. The company continues to introduce value-added features to enhance the online shopping experience. However, Alphabet stock gets a “B” grade instead of an “A” as the company is a target of a regulatory probe that could be costly and complicated.

For most investors, it will be fine to own at least a few GOOG stock shares. After all, Alphabet is a “Magnificent Seven” member and one of the world’s most important tech businesses. At the same time, there is headline risk associated with Alphabet, so there’s no need to go overboard in your position size.

Google Continues to Offer Shoppers Next-Gen Features

Much of Alphabet stock’s value stems from Google’s continued innovation in online search and shopping features. For example, Google introduced a new feature called Style Recommendations, which allows users to rate the results of their product searches.

The Style Recommendations feature mainly applies to results from queries about clothing, shoes and accessories. Users can swipe right or left to express approval or rejection of product-search results. Style Recommendations users can skip items they’re unsure about.

Google is evidently still trying out new artificial intelligence enhanced features. According to Sourcing Journal, Google recently “developed an AI-powered image generation software that helps users search for products using a visual input.”

This could be an ideal companion to Google’s “virtual try-on tool,” which gives users an idea of wearable items might look.

Alphabet Faces Antitrust Probe in the EU

Clearly, as as Google continues to advance innovative concepts, Alphabet will remain on the forefront of online search and shopping technology.

However, sometimes giant, successful companies can come under fire from government entities. Thus, Alphabet is one of multiple Big Tech businesses currently being investigated by antitrust regulators in the European Union.

Alphabet could end up paying substantial fines if it’s found to be in violation of the EU’s Digital Markets Act. According to Reuters, such violations “could result in fines of as much as 10% of the companies’ global annual turnover.”

It’s difficult to know how much Alphabet will push back against the EU’s regulations. Oliver Bethell, Google’s competition director, asserted that the company “will continue to defend our approach in the coming months.”

Is this meant to imply that Google and Alphabet will wage a protracted legal battle against regulators in the EU? Only time will tell, so stay tuned for further developments as this story unfolds.

Alphabet Stock: Weigh the Strengths Against the Risks

Alphabet still has room to improve in the generative-AI field. However, the company constantly introduces new and interesting ideas to enhance the online search and shopping experience.

On the other hand, investors shouldn’t overlook Alphabet’s regulatory hurdles in the EU. Overall, Alphabet’s headline risk is notable but doesn’t need to be a deal-breaker.

Hence, we’re assigning a “B” grade to Alphabet stock and consider it appropriate for a moderately sized share position.

On the date of publication, neither Louis Navellier nor the InvestorPlace Research Staff member primarily responsible for this article held (either directly or indirectly) any positions in the securities mentioned in this article.