Photo by Kai Wenzel on Unsplash
Alphabet Inc. (GOOGL), the Google parent, is planning on investing up to $40 billion in Anthropic, the two companies said on Friday.
The agreement will see the tech giant providing an initial $10 billion in cash for a computing capacity expansion initiative, with the remaining amount dependent on meeting certain performance targets.
The development builds on an announcement earlier in the month by Anthropic about signing a deal with Broadcom (AVGO) and Google for multiple gigawatts of computing capacity, which is anticipated to come online from next year.
Following the news, both Needham and Jefferies reiterated their Buy ratings on Alphabet Inc., with price targets of $400.
As of the close of business on April 24, the stock is a Strong Buy with an average share price upside potential of 13%.
Alphabet Inc. owns several notable platforms, including Google Search, Google Maps, Gmail, and YouTube. The company is also known for pioneering work and research in cloud computing, quantum computing, and artificial intelligence.
While we acknowledge the risk and potential of GOOGL as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame.
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