Alphabet Joins Dow Jones Industrial Average Amid AI Boom
Written by Emily J. Thompson, Senior Investment Analyst
Updated: 2 days ago
0mins
Source: NASDAQ.COM
- Dow Inclusion: Alphabet was added to the Dow Jones Industrial Average on June 29, replacing Verizon, marking it as the 16th stock to join in the last 15 years; historically, stocks added to the Dow have underperformed, averaging a 7% return in the following year.
- Accelerated Revenue Growth: Alphabet reported a 22% revenue increase in the first quarter, reaching $110 billion, with advertising sales up 15% and cloud computing sales soaring 64%, indicating strong performance in both digital advertising and cloud sectors.
- AI Integration Success: Despite initial investor fears that AI could disrupt Alphabet's dominance in internet search, the company has effectively integrated AI into its advertising and cloud products, resulting in over a 300% stock price increase since the AI boom began in January 2023.
- Future Growth Outlook: Wall Street estimates a 15% annual earnings growth for Alphabet over the next three years, with a current P/E ratio of 27; while better entry points may arise, patient investors might consider initiating a small position in Alphabet stock now.
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Analyst Views on GOOGL
Wall Street analysts forecast GOOGL stock price to rise
33 Analyst Rating
26 Buy
7 Hold
0 Sell
Strong Buy
Current: 366.460
Low
305.00
Averages
374.25
High
400.00
Current: 366.460
Low
305.00
Averages
374.25
High
400.00
About GOOGL
Alphabet Inc. is a holding company. The Company's segments include Google Services, Google Cloud, and Other Bets. The Google Services segment includes products and services such as ads, Android, Chrome, devices, Google Maps, Google Play, Search, and YouTube. The Google Cloud segment includes infrastructure and platform services, collaboration tools, and other services for enterprise customers. Its Other Bets segment is engaged in the sale of healthcare-related services and Internet services. Its Google Cloud provides enterprise-ready cloud services, including Google Cloud Platform and Google Workspace. Google Cloud Platform provides access to solutions such as artificial intelligence (AI) offerings, including its AI infrastructure, Vertex AI platform, and Gemini for Google Cloud; cybersecurity, and data and analytics. Google Workspace includes cloud-based communication and collaboration tools for enterprises, such as Calendar, Gmail, Docs, Drive, and Meet.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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