Benzinga - by Surbhi Jain, .
As technology stocks battle for artificial intelligence (AI) dominance, investors are increasingly looking for options and weighing their choices against each other.
Two popular large cap stocks among those that are leading the AI race are Alphabet Inc (NASDAQ:GOOGL) (NASDAQ:GOOG) aka Google and Meta Platforms Inc (NASDAQ:META), both with future growth hinging largely on success in the AI realm.
In the dynamic realm of AI stocks, JPMorgan analyst Doug Anmuth provided valuable insights into the battle between tech giants Alphabet Inc (NASDAQ:GOOGL) (NASDAQ:GOOG) and Meta Platforms Inc (NASDAQ:META). As investors seek growth opportunities, Anmuth’s analysis delved into the potential upside each stock offers.
Alphabet: Beneficiary Of Advancements In Generative AI JPMorgan attributed a solid Overweight rating to Alphabet, with Anmuth setting a price target of $165, signaling a promising 19% upside.
The investment thesis centered on Alphabet’s robust fundamentals, positioning the company as a key driver and beneficiary of the evolving digital economy and advancements in generative AI.
Anmuth underscored Alphabet’s unwavering focus on innovation, with healthy prospects in Search and YouTube ads, driven by AI’s ability to enhance ROI and navigate the shift of TV advertising dollars online. The inclusion of non-ad businesses, such as Cloud and YouTube subscription services, coupled with ventures like Waymo and Verily, presents additional growth avenues.
Anmuth expressed confidence in Alphabet’s innovation capabilities around Generative AI, cost control and sustained top-line growth.
Also Read: Google Is ‘Down, But Not Out’: Alphabet Analyst On GenAI Gap With Microsoft And OpenAI, Potential Dividend Move
Meta Platforms: At The Forefront Of Major Tech Waves Anmuth rated Meta as Overweight with a price target of $535, offering a respectable 9% upside.
Meta’s unique standing in terms of scale, growth and profitability driven by extensive reach and engagement is a key aspect of Anmuth’s analysis. The company’s strategic focus on AI and the Metaverse positioned it at the forefront of major tech waves. Meta’s advertising strength, supported by AI investments, is expected to outperform, providing a positive outlook for investors.
Anmuth highlighted recent tailwinds, including the initiation of a dividend, as factors contributing to Meta’s appeal. Disciplined investments, AI-driven content recommendations, and a compelling valuation, trading at approximately 20x 2025E GAAP EPS, further enhanced Meta’s attractiveness.
Also Read: What’s Going On With Meta Stock?
Alphabet Vs. Meta Stock As investors navigate the choice between AI picks Alphabet and Meta, Anmuth’s analysis served as a guide.
Alphabet’s diversified portfolio and commitment to innovation align with the evolving digital landscape, while Meta’s dominance in scale and strategic focus on major tech trends position it as a formidable contender.
Investors should weigh these insights carefully, considering the growth narratives and strategic moves of each company. While Alphabet stock appears to offer more upside from current price levels, the investment decision ultimately hinges on which stock aligns more closely with individual investor goals and risk appetite in the dynamic AI-driven market.
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Latest Ratings for META
| Jul 2020 | Desjardins | Initiates Coverage On | Buy |
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