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AI Stocks: Alphabet & Microsoft Eye $5 Trillion
16 Dec
Summary
- Analysts predict Alphabet and Microsoft could surpass $5 trillion market value.
- Alphabet's AI innovations like Gemini and AI Overviews are driving growth.
- Microsoft's target price implies significant upside from current share price.
Certain Wall Street analysts are forecasting that tech giants Alphabet and Microsoft could each achieve market capitalizations surpassing $5 trillion in the coming year. Brian Nowak at Morgan Stanley has outlined a bull case for Alphabet with a target price implying 35% upside, while Michael Turrin at Wells Fargo has set a target for Microsoft that suggests 47% potential growth.
Alphabet is actively adapting to the generative AI landscape, integrating features like AI Overviews and AI Mode into its search engine, which has reportedly increased query volumes. Its Gemini application has already garnered 650 million monthly users, presenting future monetization opportunities. Furthermore, Google Cloud is expanding its market share, bolstered by its AI capabilities and leadership in large language models.
Microsoft is also a key player in the AI race, with analysts projecting significant upside from its current share price. Both companies' focus on AI infrastructure and innovation is driving their upward trajectory. Alphabet's recent financial reports showed accelerated revenue growth and strong earnings, partly attributed to demand for AI-driven solutions.
