Chip stocks fall with Nvidia after data center rev disappointment
Investing.com - Cantor Fitzgerald has reiterated its Neutral rating and $201.00 price target on Alphabet (NASDAQ:GOOGL), highlighting the company’s expanding AI search capabilities. The tech giant, currently valued at $2.5 trillion and trading near its 52-week high, shows mixed signals according to InvestingPro data, with technical indicators suggesting overbought territory despite strong fundamentals.
The firm notes that Alphabet has extended its AI Overviews feature to over 200 countries, now reaching more than 2 billion monthly active users, representing nearly 50% of total Google search monthly active users, up from 1.5 billion in the first quarter.
Third-party research analyzing approximately 8,000 keyword queries indicates AI Overviews now appear on more than 50% of search engine results pages, a significant increase from 30% at the beginning of the year and 20% last fall.
Alphabet previously reported that users seeing AI Overviews generate 10% more queries, suggesting these AI-enhanced experiences are driving increased engagement as the company has also expanded the size of AI Overviews significantly over the past six months.
With AI coverage now exceeding 50% for both users and use-cases, Cantor Fitzgerald indicates it "wouldn’t be surprised to see the benefits of AI experiences overcoming share shifts in non-AI Overviews queries, driving a potential acceleration in query growth soon." For deeper insights into Alphabet’s AI strategy and financial metrics, including 15 additional ProTips and comprehensive valuation analysis, visit InvestingPro.
In other recent news, Meta Platforms reported a 22% year-over-year revenue growth in Q2, driven by increased user engagement and improved ad effectiveness. The company has provided Q3 revenue guidance of $47.5-50.5 billion, suggesting a 17-24% year-over-year growth, which exceeds market expectations. Meanwhile, Alphabet has been active with its AI advancements, maintaining a $225 price target from JMP Securities due to improvements in its AI Mode feature. This feature now offers personalized responses based on users’ conversation history and past searches.
Additionally, Google has reached an agreement to provide AI and cloud services to the US government, under a program called "Gemini for government." This agreement aims to enhance AI adoption across federal agencies. Stifel has reiterated its Buy rating on Alphabet, maintaining a $222 price target, following Google’s showcase of the latest Pixel devices at their annual event. The Pixel 10 series, featuring advanced Gemini AI and the new Tensor G5 chip, has been unveiled, promising enhanced on-device AI capabilities.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.