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Alphabet Inc.’s (GOOG) Generative AI Capex to Drive Up to $23B in Cloud Revenue, Says UBS

Alphabet Inc. (NASDAQ:GOOG) is among the 8 Most Promising Metaverse Stocks to Buy According to Hedge Funds.

Alphabet Inc. (NASDAQ:GOOG) is one of the most promising stocks.

On February 5, UBS increased its price target on Alphabet Inc. (NASDAQ:GOOG) to $348 from $345 while maintaining a Neutral rating on the stock. The firm pointed out that a higher-than-expected return on invested capital is a result of Google’s capital expenditures connected to generative AI. Over the 2026–2027 timeframe, these expenditures are expected to generate between $19 billion and $23 billion in cloud income and an additional $5 billion to $6 billion in advertising revenue.

Nevertheless, UBS also pointed out that increased capital expenditure is hurting overall profitability, with the anticipated gain in earnings per share in 2027 being only about 1%. The company feels that a neutral posture is still warranted because the shares are trading close to peak valuation multiples.

Additionally, it was reported on February 18 that Alphabet Inc. (NASDAQ:GOOG) announced a $15 billion plan to boost AI development in India, focusing on expanding digital infrastructure and connectivity. The project includes a new subsea gateway in Visakhapatnam and three additional routes linking India to Singapore, South Africa, and Australia, enhancing network redundancy and reliability.

GOOG is also partnering with India’s Karmayogi Bharat mission via the iGOT Karmayogi platform to digitize legacy training and expand AI-enabled learning for over 20 million public servants across 800 districts in more than 18 languages, strengthening public sector capabilities nationwide.

Alphabet Inc. (NASDAQ:GOOG) is the parent company of Google, focusing on search, AI, cloud, and emerging technologies. From a metaverse perspective, Alphabet invests in AR/VR, AI, and immersive platforms, enabling scalable virtual worlds, interactive experiences, and next-generation digital ecosystems that connect users globally.

While we acknowledge the potential of GOOG as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and have limited downside risk. If you are looking for an AI stock that is more promising than GOOG and that has a 100x upside potential, check out our report about the cheapest AI stock.

READ NEXT: 12 Unstoppable Dividend Stocks to Buy According to Analysts and Dividend Champions, Contenders and Challengers list: 15 Highest Yielding Stocks.

Disclosure: None.

The $250 Trillion AI Hype is Real. A few years from now, you’ll probably wish you’d bought this stock.

Dr. Inan Dogan

Dr. Ian Dogan

Co-Founder and Research Director at Insider Monkey

When Jeff Bezos said that one breakthrough technology would shape Amazon’s destiny, even Wall Street’s biggest analysts were caught off guard.

Fast forward a year and Amazon’s new CEO Andy Jassy described generative AI as a “once-in-a-lifetime” technology that is already being used across Amazon to reinvent customer experiences.

At the 8th Future Investment Initiative conference, Elon Musk predicted that by 2040 there would be at least 10 billion humanoid robots, with each priced between $20,000 and $25,000.

Do the math. According to Musk, this technology could be worth $250 trillion by 2040.

Put another way, that’s roughly equal to:

  • 175 Teslas
  • 107 Amazons
  • 140 Metas
  • 84 Googles
  • 65 Microsofts
  • And 55 Nvidias

And here’s the wild part — this $250 trillion wave isn’t tied to one company, but to an entire ecosystem of AI innovators set to reshape the global economy.

It’s a leap so massive, it could reshape how businesses, governments, and consumers operate worldwide.

Even if that $250 trillion figure sounds ambitious, major firms like PwC and McKinsey still see AI unlocking multi-trillion-dollar potential.

How could anything be worth that much?

The answer lies in a breakthrough so powerful it’s redefining how humanity works, learns, and creates.

And this breakthrough has already set off a frenzy among hedge funds and Wall Street’s top investors.

What most investors don’t realize is that one under-owned company holds the key to this $250 trillion revolution.

In fact, Verge argues this company’s supercheap AI technology should concern rivals.

Before I reveal the details, let’s talk about how some of the richest people on the planet are positioning themselves.

  • Bill Gates sees artificial intelligence as the “biggest technological advance in my lifetime,” more transformative than the internet or personal computer, capable of improving healthcare, education, and addressing climate change.
  • Larry Ellison — through Oracle, is spending billions on Nvidia chips and partnering with Cohere to embed generative AI across Oracle’s cloud and apps.
  • Warren Buffett — not known for tech hype — says this breakthrough could have a ‘hugely beneficial social impact.

When billionaires from Silicon Valley to Wall Street line up behind the same idea — you know it’s worth paying attention to.

Even as we admire what Tesla, Nvidia, Alphabet, and Microsoft have built, we believe an even greater opportunity lies elsewhere…

But the real story isn’t Nvidia — it’s a much smaller company quietly improving the critical technology that makes this entire revolution possible.

And judging by what I’m hearing from both Silicon Valley insiders and Wall Street veterans…

This prediction might not be bold at all:

A few years from now, you’ll wish you’d owned this stock.

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Buy This $3 Stock Now Before the 400% Surge Begins

Dr. Inan Dogan

Dr. Ian Dogan

Co-Founder and Research Director at Insider Monkey

My name is Inan Dogan. I’m the co-founder and Research Director of Insider Monkey. I have an important message for you today.

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We alerted our subscribers, and BTI returned 90% in just 16 months.

Now if you had invested just $10,000 in BTI in June 2024, you’d be sitting on $19,000 in October 2025.

Today, we have identified a nearly identical pattern in a digital-first giant trading at $3.

While the market panics over a surface-level revenue decline, our PhD-led research shows management has actually surgically cut $100 million in waste to focus on high-margin growth.

This pattern is a hallmark of our 16.5% annual return track record. The current opportunity offers a 400% upside potential—dwarfing even our 90% BTI return.

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