Alphabet Stock Lags—But Waymo May Be Its Hidden Driver

Core Viewpoint - The current market is highly reactive to news, with Alphabet Inc. (GOOGL) trading at 83% of its 52-week high, indicating underperformance compared to peers, particularly within the Magnificent Seven stocks group [2][3] Company Overview - Alphabet's stock has declined by 1.40% to $168.47, with a P/E ratio of 20.93 and a price target of $199.75 [2] - The company has not released significant news regarding artificial intelligence but has focused on its autonomous taxi service, Waymo, which is gaining traction in California [3][4] Waymo's Performance - Waymo reported 250,000 paid rides per week in 2025, indicating a mature service with substantial market acceptance [8] - The technology used by Waymo is fully autonomous and does not require human supervision, contrasting with Tesla's self-driving mode [6][7] Market Sentiment and Comparisons - The market's negative sentiment towards autonomous driving, influenced by Tesla's overpromising on its robotaxi initiative, has affected Alphabet's stock performance [5][9] - Despite the challenges, there is potential for collaboration between Waymo and Uber, as both companies explore synergies in their respective markets [11][12] Investment Interest - UBS Asset Management has built a stake worth $6.8 billion in Alphabet, indicating growing interest from institutional investors despite the company's current underperformance [13] - Alphabet holds a Moderate Buy rating among analysts, with an expected upside of 18.6% [11]