Over the past 10 years, this "Magnificent Seven" stock has soared nearly 500%: Is it time to sell?

The so-called "Big Seven" companies are taking the investment world by storm. They dominate their respective industries, have the potential to disrupt, and have seen their share prices rise dramatically in recent years.

One of the earliest Internet companiesAlphabet (NASDAQ: GOOGL) (NASDAQ: GOOG)as soon as It belongs to this category.In the past decade(math.) genus This house "The Seven Giants"The stock price has skyrocketed by nearly 500%. and, its market capitalization stands at just under $2 trillion.

Does this amazing historical performance mean it's time to sell Alphabet? Let's take a closer look at its business and stock.

Alphabet benefits from a number of long-term trends

With revenues set to reach $307 billion in 2023, investors may think that Alphabet simply doesn't have enough growth potential to drive its stock price even higher over the next decade. But it's not hard to be optimistic once you get a better look at the company's operations.

Alphabet, which generates most of its sales from digital advertising, is the clear leader in this industry. According to Grand View Research, the market will be worth more than $1 trillion by 2030, and $365 billion by 2022.

The company has two key channels to increase digital ad sales. Google Search, which accounts for more than 91% of the search market, gains revenue as more people use the Internet. YouTube, with an estimated 2.5 billion users, is another service that generates ad revenue.

The popular video streaming service also gives Alphabet a leg up in the streaming wars. In the U.S., YouTube is watched by more than NetflixThis illustrates the advantages of the user-generated model. This illustrates the advantages of the user-generated model, which can put out content that satisfies the interests of all viewers.

We can't forget about the unimpressive Google Cloud business. That division's revenue has been climbing year over year at a rate of more than 20%. What's more, it exist 2023 AnnualOperating incomeallpositive number The

Alphabet has been a big winner for investors in the past. Thanks to the continued popularity of its products and services, we can reasonably expect its revenue and earnings to grow over the long term.

Thinking about Artificial Intelligence

artificial intelligence (AI)The Rise of the Renaissance It's both hypochondriac and opportunity. On the one hand, critics argue that the ability for users to get clear answers to their queries means the end of Google search as we know it. If people spend less time scrolling through search results, the need for advertising will decline.

Speaking of the jewel in Alphabet's crown, there have been reports that the company will be launching a paid subscription service for artificially intelligent Google searches. This could be seen as a sign that the company's dominance is weakening.

But it could also be seen as a smart strategic decision by the leadership team to get ahead of the game and offer consumers more choices. Considering the huge computational costs of running AI and infrastructure, Alphabet is simply trying to pass those costs on to users. If users find the AI functionality valuable for their search needs, then they can pay for it, creating another recurring revenue stream for the company.

Measuring investor expectations

There are a number of long-term trends in the company's favor, and the forward-thinking approach to artificial intelligence is a strong reason to continue to own this stock. However, potential investors need to consider the valuation too. If the price is too high, future returns could be disappointing.

For those considering selling Alphabet stock, it's important to recognize that the stock is a good choice. (used form a nominal expression)Forward price-to-earnings ratio Therefore, I am confident to say that I think the stock is still worth buying and holding for now. Both new and existing shareholders will benefit.

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Alphabet executive Suzanne Frey is a member of The Motley Fool's board of directors. Neil Patel and his clients have no positions in any of the stocks mentioned above. the Motley Fool holds recommendations for Alphabet and Netflix. the Motley Fool has a disclosure policy.

Over the Last 10 Years, This "Magnificent Seven Stars" Stock Has Risen Nearly 500%: Is It Time to Sell? This post was originally published by The Motley Fool.