Prediction: Alphabet Stock Will Soar After July 23

Core Viewpoint - Alphabet is expected to release its Q2 results on July 23, which could act as a catalyst for its stock price to rise significantly [1] Group 1: Current Market Sentiment - Alphabet is currently one of the most disliked big tech stocks, trading at a cheap valuation compared to peers and the broader market [2] - The stock trades at a deep discount, primarily due to concerns surrounding Google Search, which is the largest segment under Alphabet [4] - Alphabet's stock is valued at less than 19 times forward earnings, significantly lower than the S&P 500's 23.7 times forward earnings, indicating deep market fears about its future [6] Group 2: Financial Performance - In Q1, Alphabet's revenue increased by 12% year over year, with diluted earnings per share (EPS) rising by 49%, showcasing strong financial results [7] - Despite fears regarding market share loss, Google Search's revenue rose by 10% year over year in Q1, aligning with expectations for a mature business [10] Group 3: Competitive Concerns - The primary concern is that Google Search may be disrupted by generative AI, with a decline in ad revenue anticipated as consumers shift to AI alternatives [8] - Google’s search engine market share has fallen below 90% for the first time since 2015, raising alarms about its competitive position [8] - Analysts may be exhibiting confirmation bias by focusing on generative AI while overlooking the majority of users who continue to prefer traditional search methods [11] Group 4: Future Outlook - The implementation of AI search overviews by Google may help retain users, allowing Google Search to maintain its dominance [12] - If Google Search revenue begins to decline, it could lead to a significant sell-off in Alphabet's stock, but current expectations remain optimistic for continued strong results [13]