Nvidia is an investor favorite when it comes to artificial intelligence. But other technology companies are also keen to expand their capabilities in this area, and one strategist says one is undervalued by the market. That's Alphabet, said Matt Orton, chief market strategist at Raymond James Investment Management, who has identified the company as one of his top picks for 2024. “This is more of an organic strategy, and I think it's undervalued by the broader market,” he said. CNBC's “Street Signs Asia” on Monday. Orton pointed to Alphabet Inc.'s launch of Gemini, which it calls the company's largest and “most capable” AI model. Businesses can use this to identify trends for better customer service efforts or to promote their products. Gemini can also be used for content creation and productivity apps. Orton called it a “game changer.” “We still see this as one of the best plays in the internet space and one of the best valuations for AI as Gemini closes the gap on GenAI,” he told CNBC. Ta. He cited the strength of the U.S. consumer as one of the factors that will accelerate Alphabet's advertising revenue. “So, adjusting for both of these, we continue to see earnings growth and margin expansion potential, and the company trades at a very attractive valuation, especially compared to some of the other Magnificent Seven companies.” I think you can see the fact that there are,” he said. Orton. “It's a really, really good set-up.'' He stressed that he was “not going to chase the stock'' but would buy if there was any further decline from here. “But if there is a downside, if we see more weakness from what we saw in the first half of this year, then keep building your position because we are a quality stock with a fortress balance sheet.” he said. Alphabet is one of the Magnificent Seven stocks, and the group as a whole helped lift the S&P 500 index by 24% in 2023. However, the stock price has fallen sharply recently, down 0.88% over the past month and down 2.8% since the beginning of the year. Year. Analysts covering Alphabet gave the company an 83% buy rating and a 13.9% upside potential from its average price target of $154.62, according to FactSet.
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