1 Bargain Artificial Intelligence (AI) Stock You Can't Afford to Miss

Group 1: Company Overview - Alphabet is a key player in the AI sector, competing with companies like Microsoft and OpenAI, and is considered a reasonably priced investment opportunity [1][2] - The company operates various segments including Google Search, YouTube, Android, and Waymo, with a significant portion of revenue coming from advertising, particularly Google Search [4] Group 2: Google Search Performance - Despite concerns about being replaced by generative AI, Google Search's revenue grew by 12% year over year in Q2, an acceleration from 10% growth in Q1, indicating strong performance [6] - Google has integrated AI into its search functionality with the launch of AI search Overviews, which combines traditional search with generative AI, likely retaining consumer engagement [5] Group 3: Google Cloud Growth - Google Cloud is experiencing significant growth, driven by increased demand for computing power for AI workloads, and has established itself as a leading platform for running AI applications [7][8] - Although Google Cloud currently accounts for only 14% of Alphabet's total revenue, it is the fastest-growing segment, with a 32% year-over-year revenue increase in Q2 [9] Group 4: Financial Metrics and Valuation - Alphabet's overall revenue rose by 14% in Q2, with diluted earnings per share (EPS) increasing by 22%, yet the stock trades at a discount compared to the broader market [10] - The stock is valued at 20.3 times forward earnings, which is lower than the S&P 500's 24.1 times and cheaper than many big tech peers, despite Alphabet's faster growth rate [12]