This artificial intelligence (AI) stock is gaining momentum fast

For too long, a narrative has persisted that Google, the tech giant synonymous with search, was somehow "behind" in the burgeoning artificial intelligence race. The perception that contenders like ChatGPT caught the behemoth off guard became a popular refrain among market commentators. Yet, beneath the surface, Alphabet, Google's parent company, was quietly building on a foundational AI legacy dating back to 2001, poised for a re-evaluation.

Recent events suggest this re-evaluation is now in full swing, offering a compelling opportunity for astute investors. Alphabet stock has found fresh momentum, fueled by a pivotal antitrust ruling that solidifies a key part of its strategic future.

The Antitrust Ruling: A Clear Path Forward for AI

A significant federal district court ruling recently delivered a powerful boost to Alphabet, confirming it would not be forced to divest its Chrome browser. While sharing data with rivals is part of the agreement, retaining Chrome is a strategic victory, ensuring Google's vast browser ecosystem remains a central platform for its evolving AI initiatives. This decision removes a cloud of uncertainty, allowing the company to accelerate its integrated AI strategy with renewed clarity and investor confidence.

Alphabet's Undeniable AI Powerhouse

Despite the initial market skepticism following new generative AI entrants, Alphabet's AI capabilities are profound and deeply integrated across its operations. The company's AI deployment is not a recent pivot but a long-standing core competency. Beyond the initial public reception of Gemini, Google Cloud is rapidly expanding as a major revenue driver, showcasing the company's enterprise-level AI solutions. Furthermore, ventures like Waymo, the autonomous driving platform, represent significant, AI-driven growth avenues that are only beginning to realize their potential.

This diversified approach to AI, leveraging decades of research and development, positions Alphabet to capitalize on multiple fronts, extending far beyond its traditional digital advertising stronghold.

Financial Strength Meets Undervalued Potential

Robust Balance Sheet and Strategic Investments

Alphabet’s financial health is robust, providing an unparalleled foundation for continued innovation. The company boasts a substantial $95 billion in liquidity, a testament to its operational excellence. This allows for aggressive strategic investments, including a pledged $75 billion in capital expenditures for 2025, specifically aimed at powering its next wave of technological advancements, particularly in AI infrastructure.

Beyond investment, Alphabet demonstrates strong shareholder returns, having authorized a $70 billion share repurchase program and recently raising its dividend. These actions reflect a company confident in its cash-generating capabilities and committed to delivering value to its owners.

Compelling Valuation

Despite its recent climb, Alphabet’s stock still presents an intriguing value proposition. Trading at a 25 P/E ratio, it remains the lowest among the "Magnificent Seven" tech giants. This suggests that the market may still be underpricing Alphabet’s long-term growth prospects, especially given its accelerating profits and pivotal role in the future of AI. In the first half of 2025 alone, revenue grew 14% to $96 billion, with net income surging by 33% to $63 billion, outpacing expense growth. Such performance underscores its financial muscle.

Seizing the Momentum

The antitrust ruling, coupled with Alphabet’s formidable AI foundation and solid financials, has ignited significant momentum. The stock has already rallied nearly 60% since early April, a clear indication that investors are starting to recognize its true potential. For those seeking exposure to a leader in AI with a strong balance sheet and a surprisingly attractive valuation, this could be the opportune moment to look beyond old perceptions and capitalize on a tech giant poised for its next phase of significant growth.

Consider how Alphabet's strategic clarity and financial power align with your long-term investment goals. Are you ready to reconsider a perceived laggard that is, in fact, accelerating?