The US stock market has certainly had its fair share of struggles this year. Although we are less than three months in, a host of companies have been steadily losing value with no end in sight. Among them is Alphabet (GOOGL), which lost $500 billion from its market cap as traders grappled with whether or not the stock is still a buy.
There is no shortage of reasons for Wall Street to be excited about the prospects of the Google parent company. It has been firmly entrenched in the ongoing AI arms race. Moreover, it is diversified enough to drive amid a continued technological revolution. But has its 2025 slide been too much? Or has it created the perfect entry point for investors?
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Alphabet Market Cap Plummets: Is GOOGL Still a Buy in 2025?
Just last week, Alphabet unveiled what they referred to as the “world’s best” AI model. Indeed, it is looking to become a staple in the artificial intelligence space that has been the source of so much demand for Wall Street investors for the last several years.
However, its breakthroughs in the sector have not been able to save the stock from a deteriorating value in the first two months of the year. Indeed, Alphabet (GOOGL) has seen its market cap shed $500 billion in value, so is the stock still a buy in March of 2025?
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Since the start of the year, amid the market downturn, GOOGL went from a $2.5 trillion market value to just $2 trillion. Moreover, its recent decline has made it the cheapest investment throughout the Magnificent Seven. However, there is no shortage of reasons for investors to be excited about the prospects of a turnaround for the company.
Although its AI and cloud computing endeavors are exciting, advertising is the bread and butter of Alphabet. It is the Google, YouTube, and Android parent company. They are all centered around advertising as a strong source of revenue. About three-quarters of the entire first revenue comes from this sector.
There are still concerns, such as the $75 billion in capital expenditures that the company is spending in 2025. That is the most invested by the company and is looking to propel its AI and cloud businesses. Those have immense potential, and with the company currently sporting a 51% upside, according to CNN, a buy-in below the $170 mark might be a smart bet for the year.