Is Alphabet Inc. (NASDAQ:GOOGL) a NASDAQ Stock with the Highest Upside Potential?

We recently published a list of the 13 NASDAQ Stocks with the Highest Upside Potential. In this article, we are going to take a look at where Alphabet Inc. (NASDAQ:GOOGL) stands against other NASDAQ stocks with high upside potential.

On April 7, Dan Ives of Wedbush Securities joined CNBC’s ‘Squawk on the Street’ to discuss how the current tariff environment could impact tech supply chains. Musk’s actions and Trump’s tariffs have contributed to broad economic uncertainty, which Ives also referred to as the economic Armageddon for US tech in an earlier conversation. He expressed concern about the structural supply chain challenges posed by recent tariffs and geopolitical tensions. Ives highlighted that the US tech sector has historically maintained an edge over China but this could be wiped out if manufacturing were relocated to the US. The logistical hurdles of building manufacturing plants in the US are not negligible and it would take 4 to 5 years to establish facilities capable of sustaining production levels comparable to those in Asia.

He also acknowledged that he hasn’t downgraded major stocks like the ones in MAG7 but remains cautious. If these previously highlighted issues persist for months, Ives anticipates drastic cuts in earnings. This uncertainty surrounding tariffs could lead to lower demand for emerging technologies like AI and cybersecurity. He explained that this situation could severely impact the US tech companies and lead to broader cuts across the tech sector — potentially up to 25% in earnings. He also criticized Elon Musk’s political involvement, which he believes has caused permanent damage to his brand and customer base. He estimated a 20% demand destruction in Europe and 10% in the US.

Our Methodology

We used the Finviz stock screener to select the 13 stocks with the highest analysts’ upside potential (at least 35%) as of April 8. The stocks are ranked in ascending order of their upside potential. We have also added the hedge fund sentiment for each stock, as of Q4 2024, which was sourced from Insider Monkey’s database.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).

Alphabet Inc. (NASDAQ:GOOGL)

Average Upside Potential as of April 8: 49.91%

Number of Hedge Fund Holders: 234

Alphabet Inc. (NASDAQ:GOOGL) operates through Google Services, Google Cloud, and Other Bets segments. Google Services offers products and services like ads, Chrome, Google Drive, and Google Maps. Google Cloud offers AI infrastructure, Vertex AI platform, cybersecurity, and data & analytics for enterprise customers. The Other Bets segment sells healthcare-related and internet services.

Ken Gawrelski of Wells Fargo maintained an Equal Weight rating on the company on March 31 while reducing the price target from $184 to $167 due to caution surrounding the market because of the current macroeconomic environment. The analyst also believes that Google’s search business could potentially be disrupted by emerging technologies, like AI.

However, the company now processes over 5 trillion annual searches, up from 2 trillion in 2016. Such improvements are fueled by AI features like Circle to Search and AI Overviews. Circle to Search lets you search for anything on your screen by circling or scribbling on it. AI overviews are AI-generated summaries that appear at the top of Google search results and provide quick answers to queries. Alphabet Inc. (NASDAQ:GOOGL) is also testing Gemini 2.0 in search results and focusing on voice, camera, and visual search to integrate advanced AI in its offering.

Due to its growth in Search and Cloud, and the company’s AI potential, Oakmark Equity and Income Fund stated the following regarding Alphabet Inc. (NASDAQ:GOOGL) in its Q4 2024 investor letter:

“Alphabet Inc. (NASDAQ:GOOGL) was the top contributor during the quarter. Despite ongoing litigation with the Department of Justice in its antitrust case, the U.S.-headquartered interactive media and services company’s stock price rose after posting solid third-quarter earnings. In the Search division, the company generated low-teens year-over-year revenue growth and management highlighted that they’re seeing strong user engagement with their new AI Overviews feature. The biggest upside surprise came from the Cloud division, where revenue growth accelerated to 35% and margins reached a record of 17%. This performance was driven by client demand for AI Infrastructure and Generative AI Solutions as well as core Google Cloud Platform (GCP) products. We continue to believe Alphabet is a collection of great businesses that can unlock further value over the long term through its world-class AI capabilities.”

Overall, GOOGL ranks 7th on our list of NASDAQ stocks with the highest upside potential. While we acknowledge the growth potential of GOOGL, our conviction lies in the belief that AI stocks hold great promise for delivering high returns and doing so within a shorter time frame. There is an AI stock that went up since the beginning of 2025, while popular AI stocks lost around 25%. If you are looking for an AI stock that is more promising than GOOGL but that trades at less than 5 times its earnings, check out our report about the cheapest AI stock.

READ NEXT: 20 Best AI Stocks To Buy Now and 30 Best Stocks to Buy Now According to Billionaires

Disclosure: None. This article is originally published at Insider Monkey.