Nothing is 100% safe in the world of technology stocks. However, you should be able to sleep soundly at night if you’re invested in Alphabet (NASDAQ:GOOG;NASDAQ:GOOGL). Alphabet stock provides good exposure to artificial intelligence technology and today we’re assigning it a “B” grade.
As you may have heard already, Alphabet just started offering a dividend to its investors. Some prospective shareholders may be concerned because Google is laying off 200 of its “core” staff members.
Thus, there’s always good news and bad news to consider; this is the case with Alphabet and, really, with all companies. So, let’s kick this discussion off with a major challenge for Alphabet before delving into an opportunity in the realm of AI-embedded products.
Alphabet’s Legal Issues Are Costly
Alphabet is currently facing legal/regulatory battles in the U.S. and the UK. Whether the company wins or loses these cases, Alphabet will surely have to shell out a lot of capital.
Just paying attorneys’ fees will rack up a sizable tab for Alphabet, no doubt.
For example, the U.S. Justice Department hit Alphabet/Google with an antitrust lawsuit. This well-publicized case is still working its way through the court system.
In that ongoing case, Google paid the U.S. government $2.3 million just to have a bench trial (with a ruling by a judge) instead of a jury trial. It doesn’t necessarily mean Google will actually win or settle that trial.
Meanwhile, in the UK, Google faces a 13.6 million euro lawsuit alleging anticompetitive practices in the advertising market.
Britain’s Competition and Markets Authority is accusing Google of “plotting to squeeze rival search engines out of the market by restricting choice on its smartphones,” according to popular British periodical The Telegraph.
Alphabet Continues Its AI-Product Push
In other news, Alphabet definitely isn’t relenting in its push to commercialize AI-embedded products.
Alphabet’s persistence is notable, considering Google’s imperfect rollouts of its Bard and Gemini generative-AI products/services.
Alphabet simply refuses to capitulate in the AI wars. The company’s investment in AI-tech startup Anthropic is one example of Alphabet’s persistence in the AI field.
Another, more recent example is Google’s rollout of its AI-powered note-taking assistant, known as NotebookLM, to more than 200 countries. TechCrunch observed that NotebookLM now includes “new features and languages to help more people use AI to generate summaries and ask questions based on their documents.”
Finally, it’s worth mentioning that Google is still the U.S. search-engine king even as the company works out the glitches in its AI products. Believe it or not, Google controls a whopping 90% of search-engine activity.
Alphabet Stock: Look Toward $200 and Beyond
Alphabet has its fair share of challenges, including AI-product imperfections and legal battles. However, the company will almost certainly continue to develop new and interesting AI-infused products.
Besides, Alphabet remains a U.S. search-engine dominator and a well-capitalized tech giant. So, feel free to buy and/or hold Alphabet stock, which earns a “B” grade.
Furthermore, keep your eyes on $200 as the next Alphabet share-price target. After that, investors can set their sights on higher price points.
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.
