Alphabet Stock Crosses $200 For First Time Following Brisk AI Product Announcements: Retail Touts It As A Value Buy

Alphabet, Inc. ($GOOGL) ($GOOG) shares crossed the $200 threshold for the first time on a split-adjusted basis, with the rally stoked by accelerating new product momentum and the broader market strength.

Alphabet, which was then known as Google, announced a 2-for-1 split in 2014. A second split, at a ratio of 20-for-1, was implemented in 2022, after Google was reorganized under the holding company Alphabet. 

After opening Tuesday’s session modestly higher, Alphabet raced to an intraday high of $201.42. The volume, however, was anemic, lending less credence to the upward momentum.

The Alphabet stock has come off the highs and was last seen trading flat with a slight negative bias. 

The stock is up over 41% for the year-to-date period.

Chart Courtesy of TradingView

 

Last week, Google released Gemini 2.0 Flash, its new artificial intelligence (AI) model for the agentic era. Commenting on it, Ark Invest analyst Jozef Soja said, “Gemini 2.0 Flash is smaller and faster than Gemini 1.5 Pro, but more performant on most benchmarks, importantly the autonomous coding benchmark SWE-bench Verified.” 

Soja noted that Google is building new and updated products around Gemini 2.0 such as the Project Mariner, an AI agent that sees and interacts with browsers, uses keyboards and cursors to chain together actions and complete complex tasks like shopping.

“Project Mariner already is demonstrating how AI agents can accelerate worker productivity and potentially facilitate trillions of dollars in online spending,” he added.

Google followed up with the release of Audio Overview feature for NotebookLM, a research and note-taking online tool. The new feature turns a user’s documents into engaging audio discussions. “With one click, two AI hosts start up a lively ‘deep dive’ discussion based on your sources,” Google said. 

On Monday, Google introduced the video generation model Veo 2, which can produce 4K videos with a runtime of a few minutes in realism, using simulations of real-world physics and human movements. It also announced Imagen 3, its latest advancement in image creation. 

Alphabet is pushing ahead with its AI initiatives at a time when the geopolitical climate favors the further advancement of the technology. Wedbush analyst Daniel Ives said in a note on Tuesday that he expects significant AI initiatives from the U.S. government in 2025, benefiting Microsoft Corp. ($MSFT), Alphabet, Amazon, Inc. ($AMZN), and other tech players.

“We believe the Softbank $100 billion AI announcement yesterday in Mar-a-Lago by CEO Masayoshi Son is just the beginning of more global AI investments in the U.S.,” he added.

Google is also making headway in another hot-and-happening technology area. Earlier this month, the search giant announced its Willow quantum chip that can reduce errors exponentially and perform a standard benchmark computation in under five minutes.

GOOGL sentiment and message volume December 17, 2024, as of 12:02 pm ET | Source: Stocktwits

On Stocktwits, sentiment toward Alphabet stock is ‘bullish’ (67/100), with the degree of bullishness improving from a day ago. The improved sentiment has been accompanied by a spike in message volume to ‘high’ levels.

The retail crowd on Stocktwits pledged allegiance to the stock, stating that it is the best to own.

Another pointed out that Google has the lowest price-to-earnings (P/E) among the Magnificent Seven companies.

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