Alphabet Inc (GOOG) Revamps Robotics Unit as Hedge Funds Grab Shares

Alphabet Inc (GOOG) Google

Alphabet Inc (NASDAQ:GOOGL) (NASDAQ:GOOG) has reorganized its business in order to improve accountability and to get its business units to start justifying costs. Alphabet has stopped its habit of giving subsidiaries handouts because it now expects them to act as real companies. In fact, the firm will start breaking down financials of its units when it reports earnings next month.

Alphabet Inc (GOOG) Google

One of the recent moves by Alphabet to get its business units to act responsibly is a revamping of its robotics division. The New York Times reports that Alphabet has reframed the robotics unit as its takes it from being a standalone unit into being a part of X research division at Alphabet. The robotics unit has been having problems for more than a year after its head, Andy Rubin left abruptly in 2014 to start a tech incubator.

Robotics is key to Alphabet’s future

Alphabet (NASDAQ:GOOGL) (NASDAQ:GOOG) has been increasingly involving itself in a number of ventures outside its core ads business. In fact, the firm has at least a company for each of the letters of the Alphabet. For instance, A is for Alphabet, Android, Adsense, Analytics/ Ara/ AdMob/ and Alerts. B is for Blogger, Boston Dynamics and Books. C is for Calico, Cardboard, and Capital.

However, the robotics unit seems to be Alphabet’s passport for catching the flight on the next wave of tech revolution as Artificial Intelligence is poised to take over a number of industries. AI is already making a difference in the auto sector as self-driving cars become the current fixation for automakers.

AI is also changing the face of medicine & surgery because robots seem to have steadier hands than human doctors. AI has already changed the face of manufacturing with robotics, but factories have only begun to scratch the surface of what is possible with nifty robotic arms. Putting the Robotics division under X Labs should help the unit awaken from its lethargy and rise up to its true potential as the next big thing in the tech space.

Alphabet gets love from Norway, Webster Bank, and others

The latent value in Alphabet’s stock is not lost on Wall Street as the stock is slowly creeping up from behind to take up the top spot from Apple Inc. (NASDAQ:AAPL) as the biggest firm by market cap in the S&P 500. Investors outside the U.S. are also keeping close tabs on Alphabet. Bloomberg reports that DNB Nordic Technology, Norway’s top performing tech fund is strongly bullish on the firm.

Alphabet is one of the biggest holdings in the fund and the fund believes that Alphabet “is one of the companies that is best positioned within many of the important trends”. The fund believes that it got into Alphabet when it was trading at a discount but one of the managers do not think this a great time to buy the stock. He says, “it’s not that cheap but valuation is still pretty okay compared to many of the other players in the Internet sector.”

In other news, Webster Bank has increased its position in Alphabet Inc by 1.5% as at the end of the fourth quarter. Webster Bank’s Alphabet stock is worth $6.25M at the end of Q4 making the stock the 18th largest position in its portfolio.  Jennison Associates is also bullish on Alphabet (NASDAQ:GOOGL) (NASDAQ:GOOG) as it increased its position by 36.6% in the third quarter. Churchill Management increased its stake in the firm by a massive 627.6% to bring its total Alphabet holdings to $49.12M.

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Victor Alagbe is a seasoned business and finance writer with a specialty in writing about how to invest for the long-term in healthcare, pharmacology, energy and tech stocks. His long-term focus is on stocks that provide a nice mix of growth and income. For the short term, he passionately writes about trading stock options for the excitement and leverage that stock options offer.

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