Alphabet (GOOGL) Rated Overweight, JPMorgan Sets $195 Target on AI Strength

We recently published a list of 12 AI Stocks on Analysts’ Radar. In this article, we are going to take a look at where Alphabet Inc. (NASDAQ:GOOGL) stands against other AI stocks on analysts’ radar.

The recently imposed US sanctions on chip use have angered China. In recent news, the country has stated that it may take legal action against any individual or organization who are found assisting or implementing U.S. measures that advise companies against using their advanced semiconductors.

According to the U.S. published guidance, companies risk violating export controls if found using Ascend AI chips from Shenzhen-based Huawei. In response, China’s commerce ministry said there could be “corresponding legal liabilities” against those involved in implementing U.S. measures and that it constitutes “discriminatory restrictive measures” against Chinese firms.

READ ALSO: 10 AI Stocks Investors Are Watching Today and 15 AI Stocks Surging on News and Analyst Ratings.

The sanctions are seemingly a new strategy adopted by the US to curb China’s progress in the AI arms race. The world is yet to watch the success of this strategy as opposed to the AI diffusion rule imposed earlier, which the world came to know had failed miserably after the arrival of DeepSeek.

Even Jensen Huang has deemed the AI diffusion rule to be a failure.

“All in all, the export control was a failure. The fundamental assumptions that led to the AI diffusion rule in the beginning, in the first place, has been proven to be fundamentally flawed.”

In fact, the sales block advanced AI chips to China, forcing companies to buy semiconductors from Chinese designers. It also pushed the country to invest aggressively in a robust supply chain that doesn’t rely on manufacturers outside the country.

For this article, we selected AI stocks by going through news articles, stock analysis, and press releases. These stocks are also popular among hedge funds. The hedge fund data is as of Q4 2024.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points  (see more details here).

Alphabet Inc. (NASDAQ:GOOGL)

Number of Hedge Fund Holders: 234

Alphabet Inc. (NASDAQ:GOOG) is an American multinational technology conglomerate holding company wholly owning the internet giant Google, amongst other businesses. On May 21, JPMorgan analyst Doug Anmuth reiterated an “Overweight” rating and $195.00 price target on the stock. Doug highlighted the company’s strong position in the AI sector as a reason behind the optimism. The company’s advancements in artificial intelligence, especially through its Gemini platform, are leading the industry.

Even Google CEO Sundar Pichai opened his keynote at the I/O conference, stating how “Every day is Gemini season at Google.” Google has sound execution capabilities, as evident by how fast it is bringing AI-driven features to the market. Moreover, the company adopts a comprehensive approach to artificial intelligence, placing it well against competitors. Its leadership in AI technology is evident through Google’s foundational models and their adoption. With the stock’s current trading price presenting a discount compared to historical averages, the stock presents a potentially attractive entry point for investors.

Overall, GOOGL ranks 2nd on our list of AI stocks on analysts’ radar. While we acknowledge the potential of GOOGL as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than GOOGL and that has 100x upside potential, check out our report about this cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires.

Disclosure: None. This article is originally published at Insider Monkey.