Alphabet (GOOG) stock remain one of the worst performers among the “Magnificent Seven” (Mag 7) tech stocks.
While other Mag 7 stocks are up over the past year, GOOG stock shed 8% during that time, but some analysts argue the market is still missing the bigger picture.
According to Stocktwits host and analyst Shay Boloor, the Google parent is significantly undervalued as it quietly builds out a broader business well beyond its legacy products.
Much of the stock’s recent underperformance is tied to concerns over a slowdown in its core search business, the rise of AI-powered rivals, and mounting regulatory pressure, including an ongoing antitrust lawsuit.
But Boloor argues those concerns are masking the strength of Alphabet’s underlying business, which he values at around $1.8 trillion, even before factoring in some of its most valuable assets.
WHY $GOOGL IS MISPRICED
undefined Shay Boloor (@StockSavvyShay) July 8, 2025
• Search still generates a $200B run rate -- even under pressure, a 4x legacy multiple = ~$800B
• Cloud is now at a ~$50B run rate -- apply a 12x multiple = ~$600B
• YouTube Ads at ~$40B -- 5x industry comp = ~$200B
• DeepMind owns the full AI stack… pic.twitter.com/XgRkr4Q6QB
That includes Google Search’s $200 billion run rate, a $50 billion cloud operation, the massive ad footprint of YouTube, and the company’s expanding AI platform anchored by DeepMind.
“[W]e haven’t even touched Gemini, Waymo, or the cash hoard,” Boloor noted, referring to Alphabet’s $96 billion in cash reserves at the end of Q1.
Google is “a legacy product being outgrown by the company itself,” he added. “This is one of the most asymmetric opportunities in Big Tech right now.”
Another strong quarter ahead?
Alphabet posted first-quarter earnings of $2.81 per share on $90.23 billion in revenue, beating expectations on both the top and bottom line.
Analysts at Zacks Investment Research expect more of the same in Q2, with year-over-year growth in both earnings and revenue.
Like its peers, Alphabet is leaning hard into AI, with plans to spend roughly $75 billion this year alone to expand its cloud infrastructure, AI training capabilities, product integration, and acquisitions.
The company’s DeepMind unit is spearheading what executives call a “full-stack” approach to AI, integrating hardware, software, and services into a unified ecosystem.
That investment is already showing up in YouTube, where AI-driven improvements to recommendations and search results have helped boost engagement.
Alphabet is also tapping into YouTube’s massive video library to train its models, according to CNBC.
“We’ve always used YouTube content to make our products better, and this hasn’t changed with the advent of AI,” a Google spokesperson told CNBC.
YouTube currently houses an estimated 20 billion videos, a massive training ground for the next generation of Alphabet’s AI tools.
Your email address will not be published. Required fields are markedmarked