Buy GOOG? Yes! The Bull Case for Google Stock.

Stocks to buy

Now is not the time to get bored and give up on Google and YouTube parent company Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL). If anything, it’s a great time to hold or even add to your GOOG stock position. The year has just begun, yet Alphabet is already introducing products and services that demonstrate the company’s pursuit of innovation.

I made a bullish multi-year call on Alphabet late last year. I’m still bullish, and I’m ready to pound the table even if the market is still anxious about technology stocks.

True contrarians should take that anxiety and turn it into opportunity. When investor sentiment is low, just stay calm and assess the facts. Alphabet will surely survive even if the company has to slim down — and a leaner Alphabet isn’t necessarily a bad thing.

What’s Happening With GOOG Stock?

GOOG stock reached its peak at approximately $150 in late 2021. As you read this, you might be able to grab some shares below $100. This is an absolute steal, as Alphabet’s trailing-12-month price-to-earnings (P/E) ratio, at 18.4x, is quite low for an American mega-cap technology company.

Besides, Alphabet is still a leader in developing great products. For instance, Alphabet’s Google Cloud just unveiled updated artificial intelligence (AI) products for retailers. These machine-learning tools can improve online browsing and product discovery, recognize customer behavior patterns and customize browsing results.

Also, YouTube is testing out free, ad-supported streaming channels that will resemble the offerings of cable television. The Wall Street Journal suggested that these channels could “allow users to peruse a list of channels, as they would on cable TV, and dip in and out of content that is already playing.”

Google’s Layoffs Shouldn’t Be Problematic for Investors

Clearly, Alphabet’s subsidiaries aren’t afraid to try out new concepts. One recent change at Alphabet might worry some investors, though. In particular, the company is joining what I call the “Layoff Club.”

Alphabet’s management has tried to avoid layoffs. However, Alphabet’s healthcare unit Verily Life Sciences is laying off over 200 employees. Moreover, Alphabet’s robotics software business, Intrinsic, plans to reduce its headcount by 40 employees.

Does this mean investors should cut and run? Not at all, as tech-sector shareholders should get used to more and more companies joining the Layoff Club. It’s a cost-cutting measure that’s unpleasant but will allow businesses like Alphabet to withstand the harsh impact of inflation.

What You Can Do Now

Many tech companies, including Alphabet, probably hired too many people prior to 2022. Now, layoffs are practically inevitable. It’s unfortunate, but Alphabet should be able to expand again when macroeconomic conditions improve eventually.

Until then, feel free to enjoy the new products and services of Alphabet’s business divisions. Clearly, Alphabet is relentless in developing innovative product ideas. This is why GOOG stock will recover sooner or later, and it’s definitely a strong buy at the current, discounted share price.

On the date of publication, David Moadel did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

David Moadel has provided compelling content – and crossed the occasional line – on behalf of Motley Fool, Crush the Street, Market Realist, TalkMarkets, TipRanks, Benzinga, and (of course) InvestorPlace.com. He also serves as the chief analyst and market researcher for Portfolio Wealth Global and hosts the popular financial YouTube channel Looking at the Markets.

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