Alphabet. They call it Alphabet now. Used to be Google, which was already a funny name, if you think about it. A number, pretending to be something more. So it goes. The stock went up a lot last year, seventy percent, they say. People get excited. They always do. Makes you wonder if there’s anything left for the rest of us.
I think there might be. Not a sure thing, mind you. Nothing ever is. But a reasonable hope. That’s what we’re after, isn’t it? A reasonable hope.
1. The Artificial Intelligence Business
A year ago, they were laughing at Alphabet in the AI world. Can you believe that? Laughing. Now, they’re one of the leaders. Funny how quickly things change. They have a side business, you see. Google Search. YouTube. Things that actually make money. Most of these AI companies are just burning cash. They need constant infusions of hope, which is just another word for money. Alphabet can fund its own dreams. A distinct advantage, if you think about it. Like bringing a sandwich to a gunfight.
The models Alphabet is building are as good as anyone’s. Maybe better. And they might be able to sell them for less. They can absorb the costs, you see. Spread them out over everything else they do. It’s a bit like having a very large, very profitable distraction. The competition is fierce, of course. Always is. But Alphabet has a good chance. Years away from knowing for sure, naturally. But a chance.
Apple is using their Gemini thing for Siri. Siri. The digital assistant that nobody really likes. Still, it’s a lucrative customer. A big one. And it shows that Alphabet is doing something right. So it goes.
2. Google Cloud: Renting the Future
Google Cloud is growing. Fast. Forty-eight percent last year. They’re renting computing power to people who want to build artificial intelligence. It’s a good business. People are happy to pay for things that might make them more money. Or at least, look like they’re trying to. They have these things called TPUs, which are an alternative to the expensive GPUs everyone else is using. Cutting costs is always a good idea. Unless you’re trying to impress someone, of course.
It’s profitable, too. A thirty percent operating margin. That’s not bad. Not bad at all. They’re selling shovels to the gold miners. A classic business. And a reasonably safe one. The cloud is where everything is going. Everything. So it goes.
3. The Price of Things
A year ago, you could buy Alphabet stock for about sixteen times earnings. Those days are gone. Now it’s twenty-six times forward earnings, twenty-eight times trailing earnings. It’s more expensive, naturally. Everything is getting more expensive. That’s just how things are.
The S&P 500 trades for about twenty-one and a half times earnings. So Alphabet is a little bit more expensive. A few points. But they have a good track record. And a bright future. Or at least, a reasonably bright future. And that’s worth something. Isn’t it?
The stock has been selling off lately. Which means you might be able to get it at a better price. A little discount. It’s not often you can buy a leader in an emerging industry at a discount. So it goes. A reasonable opportunity, if you’re looking for one. And who isn’t, really?
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2026-03-12 21:03