Alphabet: Why AI-Powered YouTube Ad Revenue Is Its Growth Catalyst

Excerpt

The following is a 250-word excerpt from my full article on Seeking Alpha: A crowdsourced financial market content service where investors can share ideas, discuss news, and make informed investment decisions. To view the full article without a paywall, please click on the link below:
https://seekingalpha.com/article/4774728?gt=83287af33219ea82

Investment Thesis

I give Alphabet Inc. (NASDAQ:GOOG) (NASDAQ:GOOGL) (TSX:GOOG:CA) a strong buy rating due to the company's excellent annual free cash flow, their high-quality earnings, their shares trading at a discount of $121.47, 45% below their intrinsic value, and their AI-powered YouTube ad revenue segment set to be a major catalyst for the company going forward and already experiencing an average 21.62% year-over-year [YoY] growth over the last seven years.

Background

I'm someone who watches a lot of YouTube. As a matter of fact, when it comes down to watching videos on streaming services, I would say that roughly 95% of my time goes to YouTube; the other 5% probably goes to Amazon Prime. So it makes sense that when I read some of the most recent news and data surrounding Alphabet on Seeking Alpha, I'll come across articles where investment firms, such as MoffetNathanson, have crowned YouTube as the 'New King of All Media.' And in another article, Nielsen noted last month that, even though TV watch time fell in February, streaming remains robust. And which streaming platform led the pack for all streaming services? You guessed it: YouTube.

Yet, what is interesting to note about most Seeking Alpha analysis done on Alphabet is how often the YouTube segment of revenue tends to go under the radar…