Key Research Findings for Alphabet, IBM, and Merck
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Sep 16 2025
0mins
Should l Buy GOOG?
Source: NASDAQ.COM
Zacks Research Daily Highlights: The report features research on 16 major stocks, including Alphabet, IBM, and Merck, along with micro-cap stocks SandRidge Energy and NeurAxis, emphasizing unique insights into smaller companies.
Alphabet's Performance: Alphabet's shares have outperformed the industry, driven by growth in Google Cloud and advancements in AI, despite ongoing litigation requiring data sharing with rivals.
IBM's Growth Strategy: IBM is focusing on its Watsonx platform and hybrid cloud solutions, but faces challenges from declining consulting sales and macroeconomic pressures.
Merck's Sales Dynamics: Merck's sales are bolstered by its Keytruda drug, despite facing competitive pressures and challenges in the Chinese market, while also pursuing M&A to enhance its pipeline.
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Analyst Views on GOOG
Wall Street analysts forecast GOOG stock price to rise
15 Analyst Rating
14 Buy
1 Hold
0 Sell
Strong Buy
Current: 308.420
Low
255.00
Averages
336.08
High
400.00
Current: 308.420
Low
255.00
Averages
336.08
High
400.00
About GOOG
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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- Capital Infusion for Expansion: This transaction reduces Alphabet's direct ownership of GFiber while bringing in outside capital to help scale the network, aiming to enhance GFiber's operational and financial independence to meet the rising demand for high-speed connectivity.
- Leadership Stability: The merged entity will be led by GFiber CEO Dinni Jain, ensuring business continuity and stability during the integration process, thereby enhancing market competitiveness.
- Market Potential and Strategic Implications: The merger is expected to create a complementary national platform capable of serving millions of customers, aligning with the growing demand for high-speed internet connectivity in the U.S. and pushing GFiber towards achieving the national scale it has not realized since its launch in 2010.
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- Amazon's Operating Leverage: Amazon (AMZN), as the world's largest e-commerce and cloud computing leader, enhances fulfillment efficiency through its DeepFleet AI model, driving operational leverage in its e-commerce business, while AWS is also experiencing rapid growth, indicating a promising future.
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- Investor Sentiment Deteriorates: Heightened concerns over economic slowdown have negatively impacted market sentiment, and the poor performance of tech stocks could affect overall market stability.
- Significant Industry Impact: The decline in tech stocks may adversely affect the financing capabilities and investor confidence of related companies, potentially hindering future technological innovation and development.
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See More
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- AI Business Advantage: Unlike other AI companies, Alphabet can self-fund its operations through diverse revenue streams such as Google Search and YouTube, allowing it to lower costs and gain a competitive edge, especially after securing Apple as a key customer for its AI solutions.
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- Cloud Business Growth: Google Cloud achieved an impressive 48% year-over-year growth in Q4, with an operating margin of 30%, indicating the success of its cloud computing business model amid surging demand for AI workloads, which is expected to continue driving overall company performance.
- Attractive Valuation for Investors: Although Alphabet's P/E ratio has risen from 16 to 26, it remains within a reasonable range compared to the S&P 500's 21.7, and with its strong performance and bright future, investors may consider entering at current price levels.
- Competitive Market Advantage: By offering TPU hardware, Google Cloud helps businesses reduce costs, enhancing its competitiveness in the cloud computing market, and is expected to attract more AI developers to rent its computing power, thereby driving sustained growth in the future.
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Current State of Big Tech: Despite recent challenges and downturns, Big Tech companies are still considered resilient and capable of recovery.
Market Sentiment: Investor confidence may be wavering, but the long-term potential of these companies remains strong, suggesting they should not be underestimated.
Innovation and Adaptation: Big Tech firms continue to innovate and adapt to changing market conditions, which could lead to future growth opportunities.
Economic Impact: The performance of Big Tech has significant implications for the broader economy, influencing job creation and technological advancement.
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Alphabet Merges Fiber Business with Astound Broadband
- New Independent Entity: Alphabet is merging its fiber internet business with Astound Broadband to create a new independent fiber provider, with Stonepeak holding the majority stake while Alphabet retains a minority stake, indicating a strategic shift in the company's fiber market approach.
- Capital Infusion for Expansion: This transaction reduces Alphabet's direct ownership of GFiber while bringing in outside capital to help scale the network, aiming to enhance GFiber's operational and financial independence to meet the rising demand for high-speed connectivity.
- Leadership Stability: The merged entity will be led by GFiber CEO Dinni Jain, ensuring business continuity and stability during the integration process, thereby enhancing market competitiveness.
- Market Potential and Strategic Implications: The merger is expected to create a complementary national platform capable of serving millions of customers, aligning with the growing demand for high-speed internet connectivity in the U.S. and pushing GFiber towards achieving the national scale it has not realized since its launch in 2010.
See More
Top Three Tech Stocks to Invest In
- Google's AI Advantage: Alphabet (GOOGL) leverages its comprehensive AI stack and the Gemini model to drive search query volume and revenue growth, achieving a 70% market share, thereby solidifying its dominant position as the internet gateway with significant future growth potential.
- Amazon's Operating Leverage: Amazon (AMZN), as the world's largest e-commerce and cloud computing leader, enhances fulfillment efficiency through its DeepFleet AI model, driving operational leverage in its e-commerce business, while AWS is also experiencing rapid growth, indicating a promising future.
- Meta's Advertising Innovation: Meta Platforms (META) utilizes AI to continuously optimize its ad recommendation algorithms, increasing user engagement and ad effectiveness, with market share expanding, especially on new platforms like WhatsApp and Threads, showcasing significant future growth potential.
- Long-Term Investment Value: All three companies possess strong market positions and technological advantages in their respective fields, making them attractive for long-term investment to capture future growth opportunities.
See More
Tech Stocks Decline Late Thursday Afternoon
- Market Weakness: Tech stocks broadly declined late Thursday afternoon, reflecting a cautious investor sentiment that may lead to short-term capital outflows from the technology sector.
- Investor Sentiment Deteriorates: Heightened concerns over economic slowdown have negatively impacted market sentiment, and the poor performance of tech stocks could affect overall market stability.
- Significant Industry Impact: The decline in tech stocks may adversely affect the financing capabilities and investor confidence of related companies, potentially hindering future technological innovation and development.
- Increased Market Volatility: As tech stocks slide, market volatility may increase, prompting investors to navigate potential market risks with caution.
See More
Alphabet's Stock Rebounds, Promising AI Business Outlook
- Stock Rebound: Over the past year, Alphabet's stock has surged approximately 70%, indicating increased investor confidence in its growth prospects, particularly as its competitiveness in the AI sector continues to strengthen.
- Cloud Computing Growth: Google Cloud achieved an impressive 48% year-over-year growth in Q4, with a 30% operating margin demonstrating profitability, indicating Alphabet's ability to capitalize on the surging demand for AI workloads through its cloud platform.
- AI Business Advantage: Unlike other AI companies, Alphabet can self-fund its operations through diverse revenue streams such as Google Search and YouTube, allowing it to lower costs and gain a competitive edge, especially after securing Apple as a key customer for its AI solutions.
- Reasonable Valuation: Although Alphabet's current P/E ratio stands at 26, slightly above the S&P 500's 21.7, this valuation is considered reasonable given its leadership in AI and future growth potential, presenting a solid investment opportunity.
See More
Google Cloud's Rapid Growth and AI Leadership
- AI Platform Emergence: Google's Gemini AI platform has emerged as a market leader, with shares up approximately 70% over the past year, showcasing its strong competitiveness in the generative AI space and attracting key customers like Apple, further solidifying its market position.
- Cloud Business Growth: Google Cloud achieved an impressive 48% year-over-year growth in Q4, with an operating margin of 30%, indicating the success of its cloud computing business model amid surging demand for AI workloads, which is expected to continue driving overall company performance.
- Attractive Valuation for Investors: Although Alphabet's P/E ratio has risen from 16 to 26, it remains within a reasonable range compared to the S&P 500's 21.7, and with its strong performance and bright future, investors may consider entering at current price levels.
- Competitive Market Advantage: By offering TPU hardware, Google Cloud helps businesses reduce costs, enhancing its competitiveness in the cloud computing market, and is expected to attract more AI developers to rent its computing power, thereby driving sustained growth in the future.
See More
Big Tech May Be Less Vocal, But Its Influence Remains Strong. Size Still Counts.
Current State of Big Tech: Despite recent challenges and downturns, Big Tech companies are still considered resilient and capable of recovery.
Market Sentiment: Investor confidence may be wavering, but the long-term potential of these companies remains strong, suggesting they should not be underestimated.
Innovation and Adaptation: Big Tech firms continue to innovate and adapt to changing market conditions, which could lead to future growth opportunities.
Economic Impact: The performance of Big Tech has significant implications for the broader economy, influencing job creation and technological advancement.
See More
