Alphabet Stock Plunges 15% - Is It Time to Buy?
Alphabet's stock has dropped by 15% from its all-time high, making it an attractive opportunity for investors. The company is seeing significant growth in Google Cloud due to its large language models and projected data center capital expenditures of between $195 billion and $205 billion for 2026.
This investment in AI is paying off, with Alphabet's integrated AI search overviews into its Google Search engine driving monetization of search results. The company also has several large language models that can be integrated into various platforms, allowing it to further monetize token usage.
Google Cloud revenue grew at an 82% pace in the past quarter and is expected to continue rising as more data centers come online. Alphabet's Q3 earnings later this month could drive the stock to a fresh all-time high, making now a great time to buy shares.
The price-to-earnings ratio of Alphabet's stock has normalized somewhat, and the company's cash from operations is an attractive metric for investors. In comparison, Apple trades at 32 times cash from operations, while Nvidia trades at 41 times.