Alphabet, the parent company of Google, has seen its stock price drop by 17% in 2023 due to challenging macroeconomic conditions, intense competition from AI platforms like ChatGPT, and regulatory pressures from the U.S. Department of Justice. Analysts anticipate modest revenue and earnings growth for 2025, yet there is concern that Alphabet might turn into a slow-growth stock similar to IBM. This has prompted analysts to suggest that investors might find better opportunities in companies like Microsoft and Oracle, which face less existential risk compared to Alphabet.
Alphabet's stock has dropped 17% in 2023 due to macroeconomic challenges, fierce competition from AI platforms, and regulatory pressures, making it less appealing for investors.
While analysts forecast 11% revenue and 19% earnings growth for 2025, Alphabet could face slowed growth akin to IBM as it encounters various competitive and regulatory hurdles.
Investors may want to pivot to stocks like Microsoft and Oracle, which are not burdened with the same existential challenges that deeply affect Alphabet's future outlook.
Alphabet's cheap forward P/E ratio of 16 might not be enough to attract investors, who remain concerned about its ability to overcome existing market pressures.
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