Alphabet’s shares (Googl) suffer a strong drop with market fears and research by DOJ, raising doubts about the future of the technology giant
What happened?
Alphabet’s online advertising giant (Nasdaq: Googl) shares fell 5% in this Monday morning session (10) after the markets fell, extending the weakness of the previous week, as concerns about the ongoing trade war continued to spread. Over the weekend, President Trump answered questions about concerns about the recession at Fox News, calling the market fighting “a transition period”, but that didn’t help to calm investors. Settlement was particularly pronounced in the technology sector, with NASDAQ falling 3% in correction territory, while S&P 500 also recorded a 2% decline.
Separately, recent judicial documents revealed that the DOJ (Department of Justice) was not retreating in its investigation, which could lead to potential dissolution of the company. Moffettnathanson analysts believed the “saga will continue during spring and summer until a final repair decision is made.”
The stock market reacts excessively to news, and large price declines can present good opportunities to buy high quality stocks. Now is the time to buy Alphabet?
What the market is telling us
Alphabet’s shares are very volatile and had 28 movements greater than 2.5% in the last year. In this context, today’s movement indicates that the market considers this news significant, but not something that would fundamentally change its perception of the business.
The biggest movement we wrote last year was about a month ago, when actions fell 8.7% with the news that the company reported below expected results in the fourth quarter of 2024. Its total revenue was in line and its Google Cloud recipe fell short, scaring some investors that had high expectations.
Given secular trends around Google Cloud, along with its long -term profit potential, it was increasingly a clear focus of investors and the market. We observed that Microsoft’s Azure division also posted worse results than expected, signaling that the market was overly optimistic about cloud computing for the fourth quarter.
On the positive side, advertising revenue slightly exceeded expectations, driven by strong contributions from both Search and Youtube. It was also encouraging to see Alphabet exceed the expectations of analysts’ operating revenue.
In AI, the company allocated US $ 75 billion for capital expenses in 2025 – right ahead of Wall Street estimates. She also launched her latest AI model, Gemini 2.0, to the public, aiming to expand her reach and remain competitive with rivals.
Looking more closely, we thought this was a mixed quarter, with poor performance areas weighing on actions that reached maximums of 52 weeks just before this announcement of profits.
Alphabet has fallen 12.6% since the beginning of the year and at $ 165.62 per share, 19.8% below its 52 -week maximum of US $ 206.38 in February 2025. Investors who bought $ 1,000 in Alphabet shares 5 years ago would now be considering an investment of $ 2,597.
Unless you are living in a cave, it must be obvious that the Generative AI will have a big impact on how big corporations do business. We prefer an action of less known (but still profitable) semiconductors that benefits from the rise of AI.
With information from Stockstory*
Source: https://www.ocafezinho.com/2025/03/10/mercado-reage-e-alphabet-afunda-na-bolsa/
