Why It Makes Sense To Overweight Alphabet Over Apple
Summary
- I'm rotating part of my Apple position into Alphabet, as Apple's growth has plateaued and its valuation remains high despite AI shortcomings.
- Alphabet offers superior risk-adjusted returns, driven by AI leadership, expanding search/advertising opportunities, and strong growth in YouTube, Cloud, and Waymo.
- Google's valuation is attractive, with discounted earnings and free cash flow yields, and its diversified business lines provide significant upside potential.
- While anti-trust and capex risks exist, I believe Google's AI/data advantages and product synergies will drive long-term shareholder value and growth.
Analyst’s Disclosure:I/we have a beneficial long position in the shares of AAPL, GOOGL either through stock ownership, options, or other derivatives. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it (other than from Seeking Alpha). I have no business relationship with any company whose stock is mentioned in this article.
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