Prediction: Alphabet's Stock Will Deliver Monster Performance Over the Next 2 Years

Core Viewpoint - Alphabet is currently undervalued in the market despite solid performance, primarily due to investor fears regarding the impact of generative AI on its legacy business, Google Search [1][2]. Financial Performance - Alphabet's stock trades at a significant discount compared to its peers in the "Magnificent Seven" group, with a forward price-to-earnings (P/E) ratio much lower than competitors like Microsoft and Apple [4][6]. - In the first quarter, Alphabet demonstrated strong growth rates in both revenue and earnings per share (EPS), ranking second in EPS growth among its peers [6][8]. Valuation Potential - If Alphabet's valuation aligns with the average of its peers, which is 31.3 times forward earnings, the stock could potentially rise by 68% without accounting for future growth [9][10]. - Achieving this valuation would position Alphabet as one of the largest companies by market cap, tied with Microsoft [12]. Market Outlook - The market may take time to recognize Alphabet's value, but if it continues to deliver strong results, it is expected to eventually receive a premium valuation similar to its peers [13].