Alphabet Inc (NASDAQ: GOOGL) is in focus today after announcing plans to acquire Intersect, a leading clean energy and data centre infrastructure firm based in San Francisco, CA.
According to its press release, the multinational is spending a whopping $4.75 billion on Intersect, locking in reliable clean energy to fuel its rapid data centre build-out.
The Intersect news is sending Google shares higher on Monday. Versus their April low, they’re up more than 100% at the time of writing.
What the Intersect deal really means for Google stock
Taking over Intersect directly addresses one of Alphabet’s most pressing needs – securing reliable, sustainable energy for its rapidly expanding data centre footprint.
Integrating Intersect’s clean power generation capabilities with its cloud infrastructure will enable Google to scale more efficiently while reducing exposure to volatile energy markets.
The acquisition also strengthens its ESG profile – appealing to institutional investors increasingly focused on sustainability.
Beyond optics, the deal ensures Alphabet’s artificial intelligence (AI) and cloud workloads have the necessary power backbone, positioning the giant to capture greater market share in cloud services.
All in all, the transaction could boost long-term growth, which in turn may drive GOOGL shares higher over time.
Is it too late to invest in GOOGL shares?
Intersect specialises in co-locating data centres with renewable energy (solar and wind) and battery storage, providing a “power-first” model for AI infrastructure.
With the acquisition, Alphabet is seeking to narrow the gap with rivals in artificial intelligence, including OpenAI, which has committed more than $1 trillion to data centre and infrastructure build-outs.
The deal is also viewed as strengthening the long-term investment case for Google, whose shares are trading at relatively modest valuations compared with other AI-linked technology stocks.
At below 30 times forward earnings, the stock is seen by some investors as offering exposure to artificial intelligence growth without the valuation risks associated with more crowded trades.
As Mark Mahaney – the head of internet research at Evercore ISI – put it in a recent interview with CNBC, “Google is a name you need to stick with” since it offers exposure to three major verticals: AI, quantum computing, and legacy tech.
Mahaney’s bullish view on Alphabet Inc
According to Mahaney, Google is a “quality compounder” with a cloud unit that’s poised to grow by north of 40% from here on out.
Moreover, “there’s a chance of reacceleration in revenue at Search, at YouTube” while the giant’s robotaxi business – Waymo – is in its early innings as well.
Taken together, these may prove sufficient tailwinds to push GOOGL stock higher in 2026, he said on “Squawk Box” last week.
A 0.27% dividend yield and billions of dollars in authorisation for stock repurchase make up for additional reasons to own this AI stock heading into the new year.
In short, the Intersect deal, artificial intelligence exposure, the overall fundamentals, and attractive valuation suggest it may not be too late to invest in Alphabet Inc.
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