Can Google's phone launch reverse the $360 billion decline?

According to the Zhitong Finance and Economics APP, Google (GOOGL.US) announced that the launch event for its new AI phone Pixel will be advanced to Tuesday afternoon at 13:00 Eastern Time. Investors are eagerly watching Google's hardware product launch event, hoping that the advanced artificial intelligence features of Pixel can help boost the market and curb the recent trend of market value evaporating by over $360 billion in just one month. Although Google's hardware devices are usually not considered by investors due to their relatively small revenue contribution compared to the digital advertising business, investors are highly anticipating that the new AI features can demonstrate leadership in the competitive field. Tim Ghriskey, Senior Portfolio Strategist at Ingalls & Snyder LLC, said, "We hope to obtain some reliable information about Google's AI products to help reverse this period of profit-taking." "Such news is very helpful for investors and most of the time it is good news that helps boost stock prices." Alphabet's stock price has already dropped 15% from its mid-July high. Like other large tech stocks, the company is facing pressure due to concerns about slowing U.S. economic growth and overvaluation, and investors are increasingly worried about relatively low spending in artificial intelligence. Alphabet's stock fell after the company's capital expenditures in the second quarter exceeded expectations, as the company strives to outperform competitors in the field of artificial intelligence. Over the past year, views on Google's position in the deployment of generative artificial intelligence technology have been crucial to its stock performance. In February this year, Google paused the model image generation of Gemini AI due to inaccurate historical descriptions, causing Alphabet's stock price to drop by over 4% in one day. In April, after announcing updates to its artificial intelligence products for cloud customers, the company's stock rebounded. At Tuesday's event, Alphabet is expected to showcase more AI products on devices, thanks to the local integration of its Gemini large language model's text, image, and voice capabilities. Analyst Mandeep Singh wrote, "The delayed launch of Apple's intelligent features, such as integration with ChatGPT in iOS 18.1, highlights Google Android's advantage in having a large language model foundation." Alphabet's recent sell-off has kept its stock hovering near the lowest levels since March. Data shows that the company's forward 12-month expected P/E ratio is 19 times, lower than the high point of nearly 24 times last month. This is lower than the S&P 500 index's average P/E ratio of about 20.5 times Eric Clark, portfolio manager at Accuvest Global Advisors, stated: "Compared to the massive free cash flow machine, Alphabet's stock price is quite cheap. The new artificial intelligence will increase the profit margin of advertising and allow for more reasonable pricing, just like what we have seen in Meta."