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Alphabet (NASDAQ:GOOG) stays a long-term buy but gets kicked off Wedbush's Best Ideas List amid AI-fueled volatility.
Shares of Alphabet popped 3.0% today despite Wedbush's Scott Devitt and team removing the stock from their Best Ideas roster, citing growing uncertainty around how AI could reshape Google's core search and ad businesses. That said, Wedbush still views Alphabet as a good long-term investment, warning only that AI-related risk is spiking short-term swingsso it no longer fits their top-pick profile.
The analysts peg fair value at $220 per share, a level they believe Alphabet can hit once AI integration proves smooth and revenue streams stabilize. But for now, AI-driven churn in search behaviorhighlighted by Apple exec Eddy Cue's recent remarks on a drop in Safari-based querieshas investors skittish.
Google quickly countered that overall searches, including on Apple devices, remain on an upward trend, but the exchange underscores how sensitive the market is to any sign that AI competition could erode ad-click volumes.
Why it matters: Removing Alphabet from a Best Ideas list signals that even top tech names can trade below fair value when AI risks loom largeinvestors must balance conviction in Google's moat against near-term volatility.
This article first appeared on GuruFocus.