This AI Powerhouse Stock Is Shockingly Cheap

Alphabet Inc. GOOG GOOGL might just be the tech world's biggest bargain – and not because its products are free. While the AI hype machine sends Microsoft Corp MSFT, Nvidia Corp (NASDAQ), and Amazon.com Inc AMZN stocks soaring into the valuation stratosphere, Google's parent quietly trades at a discount that looks harder to justify by the day.

Google Stock Trades At 35% Discount To Mag 7 Peers

As of June 12, Google stock trades near $177 with a forward P/E of just 19.2x, per Benzinga Pro data – significantly below its Magnificent Seven peers. Apple Inc AAPL (25x), Microsoft (31x), Amazon (33x), Tesla Inc TSLA (167x), and Nvidia (33x). Even Meta Platforms Inc META (27x), the other ad-tech giant, is pricier. Yet Alphabet's fundamentals don't just hold up – they shine.

Excluding Tesla's outlier valuation, Google trades at a 35.6% discount to the peer average of 29.8x, with individual discounts of 23% to Apple, 38% to Meta, and over 40% to Microsoft, Amazon, and Nvidia.

Read Also: Waymo’s Pricey Rides Are Still Stealing Uber, Lyft Customers

Google Stock: A Cash Machine With AI Tailwinds

Google Cloud is growing like a weed, logging $12.26 billion in first-quarter revenue – a 28% year-over-year jump, with margins rising to 17.8%. Its core ad business? Still a cash machine, pulling in $66.89 billion last quarter, well ahead of expectations. YouTube Shorts is finally making money, and Waymo is quietly scaling into a real business, now clocking over 250,000 driverless rides a week.

Meanwhile, Alphabet is threading AI into every product it touches – from AI Overviews in Search to Gemini-powered tools across Workspace and YouTube. It even designs its own Tensor Processing Units, cutting down reliance on Nvidia and boosting margins.

Analysts See 14% Upside From Current Levels

And the valuation? Recent analyst ratings from JPMorgan, Oppenheimer and WestPark Capital see the stock’s fair value at $201.67. That's about 14% upside, even before factoring in the $96 billion cash pile or the $70 billion buyback plan.

Yes, there are risks: the DOJ's antitrust ruling looms, and Apple may be inching toward search. But Alphabet’s sticky ecosystem – Chrome, Android, Gmail, YouTube – still dominates digital life.

In a market obsessed with AI, Alphabet's stock appears to offer value. For investors looking to ride the AI megatrend without paying AI-bubble prices, Google stock may just be the tech titan on sale.

Read Next:

• IBM, Google Emerge As Top Investors In Quantum Computing With Most Patents Issued In 2025: ‘Only Two Companies Seriously Investing,’ Says Martin Shkreli

Image created using artificial intelligence via Midjourney.