We recently compiled a list of the 10 Hot AI News Updates Analysts are Monitoring. In this article, we are going to take a look at where Alphabet Inc. (NASDAQ:GOOGL) stands against the other AI stocks.

According to Goldman Sachs, the AI-powered rally in Chinese equities could boost other markets as well. Consequently, the firm has raised its 12-month target for MSCI Emerging Markets Index by 3%, reaching 1,220 from 1,190, and reflecting an 11% potential upside from current levels. This increase reflects the impact of AI adoption on valuations through earnings, multiples and portfolio flows.

The firm further noted that China’s stock market rally has the potential to boost emerging markets that are linked to China but have been lagging previously. This could also be supported by a stimulus-driven catch-up in A-shares. In this regard, the firm said that the recent fiscal stimulus announced at China’s “Two Sessions” meeting is anticipated to stabilize growth and improve market confidence, Reuters noted.

READ ALSO: 10 High-Potential AI Stocks to Watch Right Now and 12 AI Stocks Making Headlines: Latest News and Ratings

With regard to the AI arms race, another region aiming to address the competitiveness gap is Europe. Reuters has reported how AxeleraAI, one of the few companies in Europe making computer chips for artificial intelligence, has been awarded a grant of up to 61.6 million euros ($66 million).

This grant aims to develop a chip for use in data centers, aiming to uplift EU efforts to boost the sector. Europe is increasingly trying to fund domestic chipmakers and build publicly funded data centers, known as "AI factories," making them accessible to European scientists, companies and startups.

"It's a moment of pride."

-Axelera CEO Fabrizio Del Maffeo in a phone interview

Axelera has won funding from EuroHPC, which is an agency overseeing the European Union's network of supercomputers and AI factories - to bring out a chip efficient at "inference" AI computing.

"We are not here to challenge Nvidia in the data centre space, in the training. But when the network is ready and you want to run it, we are developing a solution that can deliver extremely high performance ... we can do that."

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).

A user's hands typing a search query into a Google Search box, emphasizing the company's search capabilities.

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 March 5^th, Google announced that it has launched an experimental version of its search engine that eliminates its classic 10 blue links in favor of an AI-generated summary. Known as the “AI Mode,” the new Search mode expands AI Overviews with more advanced reasoning, thinking and multimodal capabilities, prompting helpful AI-powered responses that can go even further with follow-up questions and helpful web links.

The AI Mode uses a custom version of Gemini 2.0, a family of multimodal LLMs from Google, and integrates it with Google’s best-in-class information systems. The new feature is currently available to subscribers of Google One AI Premium and can be used via the results page for any search query by clicking on a tab labeled "AI Mode" to the side of existing options.

"We've heard from power users that they want AI responses for even more of their searches.”

-Robby Stein, a vice president of product, said in a blog post.

Overall GOOG ranks 2nd on our list of the AI stocks analysts are monitoring. While we acknowledge the potential of GOOG as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than GOOG but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

 

READ NEXT: 20 Best AI Stock To Buy Now and Complete List of All AI Companies Under $2 Billion Market Cap.

 

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