Investors and analysts are buzzing about Nvidia (NVDA -1.59%) lately. As a leader in designing artificial intelligence (AI) accelerator chips, Nvidia is among the world’s most valuable stocks. However, since early June, its stock has been trading sideways, currently available at a 17% discount from its all-time high. This sounds like a solid investment opportunity, right?
But I’m not particularly enthusiastic about Nvidia’s stock right now; it’s more of a “hold” recommendation for me. Instead, I would prefer to invest in Alphabet (GOOG 0.86%) (GOOGL 0.89%), a fellow AI expert.
Here’s why Alphabet stands out as an excellent investment option for September 2024, presented in three compelling parts.
Chapter 1: Alphabet’s Enduring Foundation
Remember when Google rebranded itself as Alphabet? This strategic move by former CFO Ruth Porat allowed the company to explore diverse business ideas without confusing users or investors.
Is Google’s expertise in online search and advertising a natural fit for fields like medical research, self-driving cars, or energy management? Perhaps not directly, but it enables its sister companies to pursue these ventures under the Alphabet umbrella, leveraging Google’s computing prowess, global data centers, and advanced research capabilities.
Now, nine years later, Porat has transitioned to the roles of president and chief investment officer, overseeing the non-Google segments of Alphabet. The organizational structure she implemented will enable Alphabet to adapt and thrive over time. If I had to choose one stock to hold forever, it would be this versatile tech giant.
Chapter 2: Google’s Long-Standing AI Expertise
Alphabet is well-positioned to capitalize on the AI boom. This company has been developing AI-powered features and services long before Nvidia and ChatGPT ignited the generative AI market. Have you used any of these Google products that are built on a shared AI foundation?
- Google Search: AI is essential for finding information quickly and accurately.
- Google Ads: The ad-buying platform utilizes deep learning analytics, enhancing personalized ad placements.
- Google Voice: This system, originally known as GrandCentral before its acquisition by Google in 2007, has been training Alphabet’s voice recognition technologies since day one, facilitating voice-based controls and dictation on Android.
- Gmail: The leading email service offers quick reply suggestions powered by the Google Gemini large language model (LLM), evolving from earlier systems.
And I haven’t even touched on the standalone Gemini LLM or Google Cloud’s potential in the AI market. Alphabet is a prominent name in the AI landscape, with its influence spanning from foundational aspects of Google Search to innovative experiments that are yet to be unveiled.
