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Alphabet Inc.

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Alphabet's focus on innovation, AI, cloud, home automation space, strategic acquisitions and Android OS should continue to generate strong cash flows. Alphabet's recent partnership with PayPal will strengthen its presence in the digital payment market. Alphabet has shown good execution to date, more or less maintaining its dominant share in a competitive, fast-growing search market. Its diversification strategy is also positive, but requires significant investment and involves uncertain payback periods, particularly since these efforts are at the cutting edge of technology. However, the company's increased spending on its consumer gadgets, YouTube video app and cloud computing services remain concerns. Also, increasing litigation issues could continue to impact the company’s profits.  Alphabet's stock has outperformed the industry it belongs to on a 12-month basis.

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