Alphabet (GOOGL) in Focus as Analysts Highlight Long-Term Upside From Waymo

Alphabet Inc. (NASDAQ:GOOGL) is one of the AI Stocks Analysts Are Watching Closely.  On December 10, Citizens reiterated its “Market Outperform” rating on the stock with a price target of $340.00. The rating affirmation reflects firm optimism in Waymo’s long-term positioning following the 1Q25 earnings call.

Boone highlighted CEO Sundar Pichai’s comments on the “optionality around personal ownership,” a sign that Alphabet understands that the power of distribution combined with leading technology can lock in “business moats”.

Licensing AV technology to auto manufacturers will allow automakers to expand supply for their ride-sharing network, strengthen distribution, and also reduce production costs through OEM partnerships.

“The benefit of licensing AV technology to auto manufacturers is that you can preference your own ride-sharing network to capture more vehicle supply as the owners of self-driving vehicles can opt into ride-sharing networks when they are not using their cars.”

The firm acknowledges that this is extremely early, and that Waymo must maintain best-in-class safety standards to avoid the same fate as other AV programs who have had accidents. The likes of Uber and GM had to close such operations after accidents that led to deaths.

“Waymo’s ability to partner and gain distribution is another first-mover advantage available to it. The other benefit of partnering with an OEM would be scaled vehicle production with sensors, which could bring down the upfront cost of vehicles for Waymo and greater production capacity as we expect it will be capacity constrained at its Arizona facility that can only produce “tens of thousands” of vehicles annually.”

Alphabet Inc. (NASDAQ:GOOGL) is an American multinational technology conglomerate holding company wholly owning the internet giant Google, amongst other businesses.

While we acknowledge the potential of GOOGL as an investment, we believe certain AI stocks offer greater upside potential and carry less downside risk. If you're looking for an extremely undervalued AI stock that also stands to benefit significantly from Trump-era tariffs and the onshoring trend, see our free report on the best short-term AI stock.

READ NEXT: 12 Hot AI Stocks on Wall Street’s Radar and 12 Must-Watch AI Stocks on Wall Street. 

Disclosure: None.